Document Type

Article

Publication Date

Winter 2003

Abstract

For much of the twentieth century, residential real estate transactions conformed to a "traditional" model--the seller engaged a broker, who listed the home in a multiple listing service, where it was noticed and purchased by a buyer, with a commission paid to the broker by the seller from the sale proceeds. While the listing/selling broker model endured for decades, it was laden with problems--it left the buyer unrepresented, created agency relationships that were counterintuitive to the parties, and often left both the consumer and realtor unsure of the precise nature of their legal relationship. Over the last fifteen years, state legislatures have set out to address these ills, enacting legislation to increase disclosure requirements, create new realtor roles, and redefine existing ones. While these reforms have added consumer choice and flexibility to the marketplace, they have not done enough to alleviate consumer confusion. After providing a comprehensive survey of state reforms, this Article argues that new laws must focus on imposing concrete duties upon licensees--most notably, other-party duties--in order to provide meaningful consumer protection. Indeed, rather than relying on increased disclosure requirements and broader consumer choice, states must enact laws that proactively protect buyers and sellers in order to eliminate the confusion produced by both the traditional model and a diverse and complicated set of reforms.

Comments

Originally published in Harvard Journal on Legislation.

Ann Morales Olazábal, Redefining Realtor Relationships and Responsibilities: The Failure of State Regulatory Responses, 40 Harvard Journal on Legislation 65 (Winter 2003).

Share

COinS