HB 337: Property Manager Requirements - Utah

Amended 2/27/2025 15:02:489 → Substitute #1 · 10 edits

MAJOR

This bill creates a new property manager license category under Utah's Real Estate Licensing and Practices Act, requiring individuals to be licensed before engaging in property management. It grants the Real Estate Commission authority to set rules for property managers, establishes exemptions for certain individuals, and modifies existing definitions and licensing requirements to accommodate the new license type.

Scope change

The bill expands the scope of the Real Estate Licensing and Practices Act to include property managers as a distinct licensed profession, previously not explicitly covered under the existing broker, associate broker, and sales agent license categories.

SCOPE

New Section 61-2f-202.5 exempts certain individuals from property manager licensure, including immediate family members of property owners, unlicensed remote assistants, and regional managers who do not engage in property management acts.

REQUIREMENT

New Section 61-2f-203 establishes licensing requirements for property managers, including criminal background checks, fingerprinting, and educational program completion (at least 24 hours), though individuals with active broker, associate broker, or sales agent licenses may obtain property manager licenses without meeting certain examination and education requirements.

New Section 61-2f-307 authorizes property managers to fill out any form, contract, or lease agreement associated with renting and managing real property.

New Section 61-2f-411 allows property managers to solicit referrals, pay finder's fees to unlicensed persons for referrals, accept referral fees, contract for services, pay bills, and advertise properties for rent or lease.

Section 61-2f-411 requires property managers to associate with at least one real estate trust account in a bank or credit union, unless they hold a security bond protecting at least 30% of estimated client funds.

Section 61-2f-204 modifies licensing fees and procedures, including requirements for fingerprinting and criminal background checks for license renewal and reinstatement.

DEFINITION

Section 61-2f-102 renumbers and modifies definitions, including changes to 'foreclosure rescue' and 'loan modification assistance' definitions, and adds new definitions for 'property management' and 'property manager'.

Section 61-2f-103 amends the Real Estate Commission composition requirements, specifying that four of five members must have at least five years' experience in real estate and hold active broker, associate broker, or sales agent licenses.

TIMELINE

Section 61-2f-411 establishes that the bill takes effect on January 1, 2026.

ENFORCEMENT

Section 61-2f-411 provides enforcement mechanisms related to property managers, including provisions for referral fees and trust account requirements.

Amended 2/21/2025 12:02:641 → Amended 2/27/2025 15:02:489 · 5 edits

MODERATE

This amendment updates HB 337 to correct definition numbering, remove outdated terms like 'dual broker' and 'condominium homeowners' association', and add new definitions for 'common interest association' and 'concurrence'. The changes streamline the bill's language and align it with current Utah real estate terminology.

Scope change

The bill's scope remains focused on property manager licensing requirements, but the definition updates ensure the legislation uses current and accurate terminology for Utah real estate entities.

DEFINITION

Reordered and renumbered definition sections to fix numbering inconsistencies between subsections.

Deleted the 'dual broker' definition which is no longer relevant to the current licensing framework.

Removed the 'condominium homeowners' association' definition as it is now covered under a different code section.

Added 'common interest association' definition to align with current Utah real estate law terminology.

Added 'concurrence' definition to clarify when multiple entities must jointly agree on actions.

Amended Excerpts 2/27/2025 15:02:489 → Amended 2/21/2025 12:02:641 · 6 edits

MODERATE

This bill replaces outdated formatting with a clean, modern bill structure and updates legal definitions to clarify terms like 'Concurrence' and 'Condominium hotel.' It also removes obsolete definitions related to dual brokers and renumbers remaining definitions for consistency.

Scope change

The bill's scope remains focused on Utah's Real Estate Licensing and Practices Act, but the formatting changes improve readability and organization of the document.

TECHNICAL

Removed old-style amendment markers and fragmented text that were artifacts of previous editing processes.

Added a new title page with sponsor information and a Long Title section explaining the bill's purpose and provisions.

DEFINITION

Updated definition of 'Concurrence' to clarify that entities with concurring roles must jointly agree for action to be taken.

Split the 'Condominium hotel' definition into two parts to clarify what does and does not qualify as a condominium hotel.

Deleted the definition for 'Dual broker' which is no longer relevant to current licensing requirements.

Renumbered and reorganized definitions to create a cleaner sequence from (1) through (14).

Amended Excerpts 2/21/2025 12:02:641 → Amended Excerpts 2/27/2025 15:02:489 · 4 edits

MODERATE

The bill was amended to add new definitions for real estate terms and modify exemptions for property managers regarding trust account requirements. The changes clarify who qualifies for exceptions from mandatory trust accounts and update terminology to align with existing state laws.

Scope change

The bill's scope expanded to include new definitions for 'common interest association' and 'condominium homeowners' association', broadening the regulatory framework to cover more types of property management relationships.

DEFINITION

Added new definitions for 'common interest association' and 'condominium homeowners' association' to clarify which entities are covered under the real estate regulations.

ELIGIBILITY

Modified the exemption criteria for property managers, changing the threshold from requiring a security bond protecting 30% of client funds to a different structure that exempts managers with adequate bonding.

REQUIREMENT

Added new requirements for regular salaried employees of condominium associations to manage real estate only for one association, limiting their scope of authority.

TECHNICAL

Made technical and conforming changes to align the bill's language with existing state statutes and remove outdated references to lease and exchange activities.

Enrolled → Amended Excerpts 2/21/2025 12:02:641 · 6 edits

MODERATE

This amendment adds exemptions to property manager licensure requirements and modifies trust account rules. It creates a new license category for property managers, allows existing brokers to obtain property manager licenses without exams, and provides an exemption for property managers with security bonds covering at least 30% of client funds from mandatory trust account requirements.

Scope change

The bill now explicitly defines property management activities and creates a new property manager license category, expanding the scope of who must be licensed and under what conditions.

ELIGIBILITY

Added a new license category for property managers with specific requirements and exemptions for existing licensed brokers.

Modified licensure requirements to allow individuals with active broker, associate broker, or sales agent licenses to obtain property manager licenses without meeting certain examination and education requirements.

REQUIREMENT

Added new exemptions for property managers who hold security bonds protecting at least 30% of estimated client funds from mandatory trust account requirements.

Modified trust account requirements to include a new provision requiring property managers affiliated with principal brokers to keep client funds in the principal broker's trust account.

DEFINITION

Added new definitions for property manager, property management, property management sales agent, and related terms.

ENFORCEMENT

Added enforcement provisions allowing property managers to fill out forms and documents related to property management and to pay referral fees.

Substitute #1 → Substitute #2 · 8 edits

MODERATE

This bill revises Utah's Real Estate Licensing and Practices Act to create a new property manager license category, requiring property managers to be licensed while exempting certain individuals like immediate family members and unlicensed assistants. It grants the Real Estate Commission authority to set rules for property management, establishes new exemptions from licensure, and modifies requirements for existing licensees to obtain property manager credentials.

Scope change

The bill expands the scope of the Real Estate Licensing and Practices Act by adding property management as a distinct licensable occupation and creating specific exemptions for individuals who perform property management tasks without requiring a license.

REQUIREMENT

Creates a new property manager license category requiring individuals to be licensed before engaging in property management activities.

Allows individuals with active broker, associate broker, or sales agent licenses to obtain a property manager license without meeting standard examination and education requirements.

Requires property managers to associate funds with a real estate trust account, but exempts those holding a security bond protecting at least 30% of estimated client funds.

DEFINITION

Adds new definitions for property manager, property management, property management sales agent, and dual broker to clarify the scope of the new license category.

ELIGIBILITY

Establishes exemptions from licensure for immediate family members of property owners, unlicensed assistants, and regional managers who do not engage in regulated property management acts.

Modifies the definition of 'associate broker' to reference subsection (19) instead of (20) in the definitions section, aligning with renumbered statutory language.

ENFORCEMENT

Authorizes property managers to fill out forms and documents related to property management and permits soliciting referrals and paying finder's fees to unlicensed persons.

AUTHORITY

Grants the Real Estate Commission authority to make administrative rules relating to property managers, including licensing, registration, and education requirements.

Introduced → Enrolled · 8 edits · Mar 26, 2025

MODERATE

This bill creates a new property manager license category under Utah's Real Estate Licensing and Practices Act, establishing specific requirements for individuals managing real estate for others. The legislation defines property management activities, sets licensing qualifications, and clarifies exemptions for certain individuals like property owners and family members. It also grants the Real Estate Commission authority to create administrative rules governing property managers and modifies existing definitions to accommodate this new license type.

Scope change

The bill expands the scope of Utah's real estate licensing framework by adding a distinct property manager license category, separating property management from traditional real estate brokerage activities while maintaining regulatory oversight.

REQUIREMENT

New property manager license category created with specific education and examination requirements, though individuals with active broker, associate broker, or sales agent licenses can obtain property manager licensure without meeting certain exam and education requirements.

Property managers must associate with a real estate trust account for client funds, but are exempt from this requirement if they hold a security bond protecting at least 30% of estimated client funds.

DEFINITION

Added new definitions for 'property manager', 'property management', 'property management sales agent', 'dual broker', and 'real estate trust account' to clarify the scope of property management activities.

Modified existing definitions to renumber and update references to accommodate the new property manager license category and related terminology.

ELIGIBILITY

Property managers are exempt from the requirement to affiliate with a principal broker, unlike sales agents and associate brokers who must maintain such affiliations.

ENFORCEMENT

New enforcement provisions allow the commission to issue non-financial penalties to property managers and require disclosure of ownership interests to renters or prospective tenants.

SCOPE

Property managers are authorized to fill out any form, contract, or lease agreement related to property management without needing a separate real estate license.

TIMELINE

Bill takes effect on May 7, 2025, providing time for implementation of new licensing requirements and administrative rules.

Property Manager Requirements

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