Many quot;Clean Upquot; Changes to Real Estate Laws
Written By: Jaymi Naciri
Wednesday, November 14, 2018
Many of the changes are simply matters >
Of particular note are changes in the rules regarding agency disclosure and identification.
bull; Under current law, the requirement of an agency disclosure in a residential transaction is limited to residential properties of less than five units. That limit has been removed; the disclosure is now required on all real property transfers including vacant land.
bull; It is no longer required that a buyerrsquo;s agent present an agency disclosure to the seller. That provision made sense once ndash; when agency disclosures were something new, and it was often likely that disclosure might not have been made to the seller by the listing agent. But now, agency disclosure is so ingrained that the ldquo;third disclosurerdquo; is just an awkward fifth wheel.
bull; Agency disclosure is one of the areas where the term ldquo;selling agentrdquo; and ldquo;listing agentrdquo; have, respectively, been replaced by ldquo;buyerrsquo;s agentrdquo; and ldquo;sellerrsquo;s agent.rdquo;
bull; The agency confirmation section has been changed in order to clarify roles. Presently there is only one space each for the buyerrsquo;s and sellerrsquo;s agent. That space is meant to be filled in by the firm name, although many agents incorrectly enter their own name there. Now, there are two spaces each for both buyer and seller each. One is for the brokerage firm, including DRE number, and one is for the individual agent and his or her DRE number. Also, the term ldquo;dual agentrdquo; has been added, to be used where appropriate. The recent CAR memo emphasizes that, if an agentrsquo;s firm represents both parties, then even if the buyer and seller are represented by different individual agents, both agents are dual agents.
Among other changes:
bull; Responsible brokers will no longer by required to maintain physical possession of salespersonsrsquo; licenses.
bull; Salespersons may enter into compensation agreements among themselves e.g. in referral situations, or by ldquo;sharingrdquo; a client, but payment must be paid through the responsible broker.
bull; An agency listing, whereby the seller can still procure their own buyer without owing a commission, is now termed a ldquo;seller reserved listing agreement.rdquo;
The CAR memo emphasizes that the changes were not intended to create new law, but only to ldquo;me>
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