Which scenario represents a valid material fact disclosure?

The presence of earthquake activity in an area is a valid material fact and must be disclosed because it directly impacts the safety and potential risk associated with a property. In California, where earthquake activity is a known concern, the likelihood of seismic events is essential for buyers to understand. This information can affect a buyer's decision, insurance costs, and the potential future value of the property. Thus, it qualifies as a material fact that relates to the property’s condition or the risk involved in owning or occupying the property.

In contrast, while the presence of a new shopping mall could influence property values or neighborhood desirability, it is not a material fact in the same sense; it doesn’t impact the property’s physical condition or safety directly. The aesthetic condition of neighboring properties could affect desirability but doesn't constitute a material fact regarding the property itself or safety concerns. The local crime rate may be relevant to buyers considering the security of an area, but it’s typically more of a subjective concern rather than a concrete material fact tied to the property’s condition.