Which scenario qualifies as an adverse material fact that must be disclosed to buyers?

The presence of chipping or peeling paint in target housing qualifies as an adverse material fact that must be disclosed to buyers due to its implications for health and safety, particularly when it comes to lead-based paint hazards. Properties built before 1978 may contain lead-based paint, which poses serious health risks, especially to children. Therefore, disclosing the condition of the paint is critical for ensuring that potential buyers are fully informed about potential health risks associated with the property.

In contrast, while factors like the presence of a nearby school, a recent property tax increase, and the age of the property may influence a buyer's decision, they do not inherently present the same level of health or safety concern as the presence of deteriorating paint. These other factors are typically related more to personal preference or financial implications rather than urgent material concerns that could directly impact the livability or safety of the property.