Do I have to go through mediation before I'm allowed to file a lawsuit?

Almost certainly yes, if your original purchase used the standard, widely adopted California Residential Purchase Agreement form, since that standard form contains a mandatory mediation clause requiring the parties to attempt mediation, a structured settlement negotiation facilitated by a neutral third party, before either side can file a lawsuit over disputes arising from the transaction.

The consequence of skipping this required mediation step, rather than it simply being optional guidance, is typically the loss of your contractual right to recover attorney fees from the other side even if you ultimately win your case outright in court later. Given that attorney fees on a real estate non-disclosure case can represent a genuinely significant amount of money, checking this specific clause, commonly found around paragraph 22 in the standard form, in your own contract before filing anything is a step worth taking seriously.