New Online Resource Highlights NAR Settlement, HB 466 Changes for Agents, Consumers

COLUMBUS, Ohio - In response to a major legal decision impacting the National Association of Realtors (NAR) this past spring, as well as legislation passed by the Ohio General Assembly in May, the Ohio Department of CommerceDivision of Real Estate and Professional Licensing has developed an online resource to help consumers understand how recent changes to real estate law may impact them.

This resource is formatted in a question-and-answer style to address uncertainty that consumers, both those who are new to real estate as well as seasoned veterans, may have in the event they plan to sell or purchase property in the near future.

In July 2024, Gov. Mike DeWine signed House Bill 466, which aligns with the NAR settlement regarding residential real estate transactions, specifically broker commissions. This settlement's terms take effect this Saturday, Aug. 17, for NAR member agents. Meanwhile, similar requirements from HB 466 will impact all licensed agents engaging in residential real estate transactions beginning Oct. 24, 2024.

"The most significant change that potential buyers should understand is that, before a homebuyer's agent can show them any property, they must first sign a buyer agency agreement," said REPL Superintendent Daphne Hawk. "That agreement must include the amount the agent will be paid, as well as the manner in which that payment will occur, for work outlined in the agency agreement. Gone are the days that a real estate agent can show a property without having that agreement in place."

The online resource walks consumers through a range of scenarios and explains how the settlement and legislative changes impact agency agreements, which buyers and sellers formally establish with their real estate agents.

One of the key items for potential homebuyers to understand is they have options on how they are represented in real estate transactions. Those options include:

• Opting for agent representation with fiduciary duties including obedience, loyalty, disclosure, confidentiality, accounting and reasonable care.
• Choosing to proceed without representation, which involves the seller's agent drafting offers based on the buyer's preferences, but the agent will not provide the buyer advice or ongoing guidance throughout the transaction.
• Giving consideration to dual agency, in which one agent facilitates the transaction for both parties. This entails maintaining a neutral stance between buyer and seller, prohibiting advocacy for one client over the other's interests and refraining from disclosing personal or confidential information without written consent. The agent's primary focus is facilitating the transaction smoothly.

"Real estate law can be confusing for many individuals, and it's our goal to help consumers and our licensees understand how to navigate this process, especially given these changes. That's what makes this new online resource so important," Hawk said.

The Division of Real Estate & Professional Licensing is a state agency within the Ohio Department of Commerce. The Division licenses and regulates real estate brokers and sales associates who conduct business in Ohio. It ensures the professional competency of licensees and enforces fair business practices throughout the industry.