HB 1684: Real estate brokers and salespersons; duties, licensees engaged by buyers. - Virginia

General Laws Substitute → Chaptered · 7 edits

MODERATE

This bill updates Virginia real estate licensing laws to clarify agency relationships, define duties for different types of agents (standard, limited service, independent contractor), and establish disclosure requirements for dual agency and designated representation in both residential and commercial transactions. The changes aim to provide clearer protections for consumers and more defined obligations for licensees.

Scope change

The bill applies to all real estate licensees in Virginia engaged in residential and commercial transactions, with specific provisions for different types of agency relationships.

DEFINITION

Added and refined definitions for 'Agency', 'Agent', 'Brokerage agreement', 'Brokerage relationship', 'Brokerage services', 'Client', 'Commercial real estate', 'Common source information company', 'Customer', 'Designated agent', 'Dual agent', 'Independent contractor', 'Limited service agent', 'Ministerial acts', 'Property management agreement', 'Residential real estate', and 'Showing property'.

Clarified that commercial real estate does not include single-family residential units, condominiums, townhouses, apartments, or homes in subdivisions when leased on a unit-by-unit basis.

REQUIREMENT

Updated duties for licensees engaged by sellers, buyers, landlords, and tenants to include specific obligations regarding confidentiality, disclosure of material facts, and performance of ministerial acts.

Added new requirements for limited service agents to disclose specific duties they will not provide and to provide written disclosures about rights and obligations under state laws.

Modified disclosure requirements for dual agency and designated representation in residential and commercial transactions, including specific language and formatting requirements for disclosure forms.

Changed the requirement for written brokerage agreements, allowing licensees to show properties to prospective buyers or tenants before executing a written agreement in certain circumstances.

Added specific disclosure requirements about defective drywall and lead-free plumbing fixtures in residential properties.

General Laws Subcommittee Substitute → General Laws Substitute · 5 edits

MODERATE

This bill amends Virginia real estate licensing laws to clarify duties between brokers and clients, introduce new agency types (limited service agents, designated agents), and update disclosure requirements for dual agency situations. The changes aim to provide more transparency in real estate transactions and give consumers clearer options for how their agents represent them.

Scope change

The bill expands the scope of agency relationships by formally recognizing limited service agents and designated agents as distinct from standard agents, while maintaining requirements for written brokerage agreements and disclosure of dual representation.

DEFINITION

Added new definitions for 'limited service agent' and 'designated agent' to clarify when licensees can provide reduced services or represent multiple clients in a transaction.

REQUIREMENT

Modified disclosure requirements to mandate conspicuous formatting (bold, all caps, underlined, or separate box) for dual agency and designated agency disclosures in residential and commercial transactions.

Added new section 54.1-2139.1 to authorize designated standard agency or designated representation in residential real estate transactions, allowing brokers to assign different licensees to represent different clients.

Modified drywall disclosure requirements in § 54.1-2131 and § 54.1-2132 to align defective drywall definitions with § 36-156.1 and clarify what constitutes 'physical condition of the property' for disclosure purposes.

Modified § 54.1-2132 to remove the requirement that a licensee must enter into a brokerage agreement before showing property to a prospective buyer, allowing showings to occur before formal agreement execution.

Enrolled → General Laws Subcommittee Substitute · 7 edits

MODERATE

This bill amends Virginia's real estate brokerage laws to clarify duties between licensees and clients, add new definitions for agency relationships, and introduce new disclosure requirements for dual agency and designated representation in both residential and commercial transactions. The changes aim to provide clearer protections for consumers and establish more transparent standards for how real estate professionals represent multiple parties in transactions.

Scope change

The bill expands disclosure requirements to include commercial real estate transactions for dual agency situations, which previously only applied to residential transactions. It also adds new provisions for designated representation arrangements.

DEFINITION

Added new definitions for 'limited service agent' and clarified obligations for independent contractors in brokerage relationships.

Modified the definition of 'Agency' to clarify when licensees act as independent contractors versus agents.

REQUIREMENT

Added new § 54.1-2139.01 requiring written consent and disclosure for dual agency in commercial real estate transactions.

Added new § 54.1-2139.1 establishing designated agency/representation disclosure requirements for residential transactions.

Modified § 54.1-2132 to require brokerages agreements with buyers before showing properties, with an exception allowing showings before agreement execution.

Modified § 54.1-2134 to require brokerages agreements with tenants before showing properties, with an exception allowing showings before agreement execution.

Added specific disclosure language requirements for limited service agents, requiring conspicuous formatting and listing of excluded duties.

Introduced → Enrolled · 3 edits · Mar 24, 2025

MINOR

This bill was enacted into law (Enrolled) after being introduced as a draft (Introduced). The primary substantive change is the addition of new definitions for real estate agency relationships, including 'standard agent', 'limited service agent', 'independent contractor', and 'designated agent'. The bill also expands the scope of amendments to include multiple sections of the Code of Virginia beyond just § 54.1-2132, clarifying duties for different types of brokerage relationships.

Scope change

The bill's scope expanded from amending only § 54.1-2132 to amending multiple sections (§§ 54.1-2130 through 54.1-2134, 54.1-2137, 54.1-2138.1, 54.1-2139, 54.1-2139.01, and 54.1-2139.1) to comprehensively address real estate brokerage relationships and duties.

DEFINITION

Added new definitions for 'Agency', 'Agent', 'Brokerage agreement', 'Brokerage relationship', 'Brokerage services', 'Client', 'Commercial real estate', 'Common source information company', 'Customer', 'Designated agent', 'Dual agent', and 'Independent contractor' to clarify real estate representation relationships.

SCOPE

Expanded the bill's scope from amending a single section (§ 54.1-2132) to amending multiple sections covering definitions and various brokerage duties throughout Title 54.1 of the Code of Virginia.

REQUIREMENT

Added requirements for licensees acting as independent contractors to comply with specific subdivisions of multiple sections while having no other obligations under the article.

Real estate brokers and salespersons; duties, licensees engaged by buyers.

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