Pennsylvania Act 2006-125 — REAL ESTATE LICENSING AND REGISTRATION ACT - DISCLOSURE AT INITIAL INTERVIEW AND DEFINING "COMMERCIAL PROPERTY"

Act text

REAL ESTATE LICENSING AND REGISTRATION ACT - DISCLOSURE AT INITIAL
               INTERVIEW AND DEFINING "COMMERCIAL PROPERTY"
                 Act of Oct. 27, 2006, P.L. 1189, No. 125             Cl. 63
                             Session of 2006
                               No. 2006-125

     HB 2631

                                  AN ACT

     Amending the act of February 19, 1980 (P.L.15, No.9), entitled
        "An act establishing the State Real Estate Commission and
        providing for the licensing of real estate brokers and
        salesmen," defining "commercial property"; and further
        providing for disclosure at initial interview.

        The General Assembly of the Commonwealth of Pennsylvania
     hereby enacts as follows:

        Section 1.  Section 201 of the act of February 19, 1980
     (P.L.15, No.9), known as the Real Estate Licensing and
     Registration Act, is amended by adding a definition to read:
      Section 201.  Definitions.
        The following words and phrases when used in this act shall
     have, unless the context clearly indicates otherwise, the
     meanings given to them in this section:
        * * *
        "Commercial property."  Any of the following:
            (1)  Any property, or portion thereof, which is used,
        occupied or is intended, arranged or designed to be used or
        occupied for the purpose of operating a business, an office,
        a manufacturing facility or any public accommodation. This
        paragraph does not include property which consists of less
        than five residential dwelling units.
            (2)  Any vacant land offered for sale or lease, or held,
        for the purpose of constructing or locating thereon a
        building, structure or facility, or portion thereof, which is
        intended, arranged or designed to be used or occupied for the
        purpose of operating a business, an office, a manufacturing
        facility or any public accommodation. This paragraph does not
        include vacant land suitable only for construction or
        location of less than five residential dwelling units.
        * * *
        Section 2.  Section 608(a) of the act, amended June 22, 2000
     (P.L.371, No.47), is amended and the section is amended by
     adding a subsection to read:
      Section 608.  Information to be given at initial interview.
        (a)  Except as set forth in subsections (b), (c), (d) [and],
     (e) and (f), the commission shall establish rules or regulations
     which shall set forth the manner and method of disclosure of
     information to the prospective buyer/tenant or seller/landlord
     during the initial interview. For the purposes of this section,
     the initial interview is the first contact between a licensee
     and a consumer of real estate-related services where a
     substantive discussion about real estate needs occurs. Such
     disclosure shall be provided on a form adopted by the commission
     by regulation and shall include, but shall not be limited to:
            (1)  A disclosure of the relationships in which the
        broker may engage with the consumer. The disclosure shall
        describe the duties that the broker owes in each relationship
        provided for in this act.
            (2)  A statement informing sellers and buyers of their
        option to have an agency relationship with a broker, that an
        agency relationship is not to be presumed and that it will
        exist only as set forth in a written agreement between the
        broker and consumer of real estate service acknowledged by
        the consumer.
            (3)  A statement that a real estate consumer has the
        right to enter into a negotiated agreement with the broker
        limiting the activities or practices that the broker will
        provide for on behalf of the consumer and that the fee and
        services to be provided are to be determined by negotiations
        between the consumer and the broker.
            (4)  A statement identifying any possibility that the
        broker may provide services to another consumer who may be
        party to the transaction and, if so, an explanation of the
        duties the broker may owe the other party and whether the
        broker may accept a fee for those services.
            (5)  A statement identifying any possibility that the
        broker may designate one or more licensees affiliated with
        the broker to represent the separate interest of the parties
        to the transaction.
            (6)  A statement of the broker's policies regarding
        cooperation with other brokers, including the sharing of
        fees.
            (7)  A statement that a buyer's broker may be paid a fee
        that is a percentage of the purchase price and the buyer's
        broker, even if compensated by the listing broker, will
        represent the interests of the buyer.
            (8)  A statement that the duration of the broker's
        employment and the broker's fees are negotiable.
            (9)  The purpose of the Real Estate Recovery Fund and the
        telephone number of the commission at which further
        information about the fund may be obtained.
            (10)  A statement that the duration of the listing
        agreement or contract and the broker's commission are
        negotiable.
            (11)  A statement that any sales agreement must contain
        the zoning classification of a property except in cases where
        the property (or each parcel thereof, if subdividable) is
        zoned solely or primarily to permit single-family dwellings.
        * * *
        (f)  The disclosures required under subsections (a), (b) and
     (c) do not apply in commercial property sale or lease
     transactions unless the prospective buyer/tenant or
     seller/landlord is an individual.
        Section 3.  This act shall take effect in 90 days.

     APPROVED--The 27th day of October, A. D. 2006.

     EDWARD G. RENDELL