Real estate laws

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In today’s fast-paced world, it’s no surprise that legal issues are constantly changing and evolving. New laws are implemented almost continuously, and existing laws are amended regularly. If you operate a real estate business in the United States, there’s a good chance you will be affected by new legislation sooner or later. We take a look at some of the most recent developments in real estate law and how they could affect your business.

Title IX

The landmark law from 1972 (Title IX) prohibiting discrimination in educational institutions applies to more than just sports! This law is actually very broad in scope, covering any education program or activity receiving federal financial assistance. This means Title IX applies to all areas of education, including K-12, higher education, and vocational training. There are, however, two exceptions to Title IX. The first is religion; the law does not apply to institutions with a religious affiliation. The second exemption is athletics, which is covered by a different law. That’s why most people only think of Title IX in regard to sports.

AG Warnings

Recently, some state attorneys general have attempted to enforce a new “duty to warn” in real estate transactions. This “duty” is a part of the ongoing fight against human trafficking. In short, the AGs are trying to extend the duty to caution language in residential lease agreements to also include information about human trafficking and sexual exploitation. In some instances, the AGs have also suggested that real estate agents and brokers be held responsible for notifying their landlords of their tenants’ “risk level.” This duty to warn is not currently required by law and is largely unenforceable. Furthermore, it is likely to cause confusion, miscommunication, and misunderstanding. Unfortunately, many of the AGs have yet to understand the serious problems that can occur by extending the duty to caution beyond its current language.

Fiduciary Duty for Real Estate Agents

One of the most misunderstood and misused terms in real estate law is the fiduciary duty. Many agents believe they must act as fiduciaries in order to follow the law, and yet not all of them are required to do so. The fiduciary duty is a specific legal obligation that applies only to real estate brokers. Because brokers are required to act in their clients’ best interests, they have a fiduciary duty to their clients. In other words, a broker has an obligation to act in the best interest of her clients, and not in her (or her company’s) best interest. This means that a broker cannot legally receive a commission if she is not acting as a fiduciary. A non-fiduciary agent, on the other hand, can legally earn a commission, even if she didn’t do all she could to get her clients the best deal.

Fair Housing Act Changes

The Fair Housing Act is one of the most important pieces of legislation in real estate. It outlaws any discrimination against renters or buyers on the basis of race, religion, national origin, sex, familial status, or disability. The FHA has been amended several times over the years, each time expanding the scope of the act and punishing the perpetrators more harshly. The most recent change to the FHA occurred in 2016. The update added protection for people with a “sexual orientation” and a “gender identity” in its list of protected classes. It also contained harsher penalties for those who violate the law.

Electronic Signature in Real Estate

Electronic signatures are now legally valid in most states. Therefore, you can use such methods of signing documents as scanning and emailing them, as long as both parties agree to the terms and conditions. In the context of real estate, this has several positive effects. For one thing, it makes the process of buying and selling property much quicker and cheaper. Electronic signatures also make it easier for people to sign documents, even those who can’t physically go to a notary public. For example, someone who lives in another state but is interested in buying a house that is being sold by someone in his state can sign the documents electronically. All they have to do is find a computer and connect to the internet.

New Certification Standards for Agents and Brokers

From time to time, the National Association of Realtors (NAR) will create new certification standards for agents and brokers. These standards are designed to ensure that you have the knowledge and skills needed to be successful in real estate. To remain certified, you must keep up with the latest trends in the industry and pass a series of tests. You also have to renew your certification every 10 years. If you want to be a real estate agent, you will be required to pass one exam and complete a certain amount of training. If you want to become a broker, you will have to take additional classes and pass several difficult exams.

Summary

Real estate laws are always evolving. New legislation is enacted regularly, and existing laws are amended to improve and update current practices. Some of the most recent developments in real estate law include Title IX changes and a new fiduciary duty for real estate agents. Additionally, the Fair Housing Act has been amended and new certification standards for agents and brokers have been implemented. Finally, electronic signatures in real estate have become legally valid and accepted in most states.