North Columbus News

In a significant legislative milestone for the real estate industry, HB 466 has passed both chambers of the Ohio Statehouse. This legislation, championed by Ohio REALTORS®, will require the use of written agency agreements between real estate professionals and their clients. The law aims to ensure clarity, consistency, and trust throughout the homebuying and selling processes in Ohio.

As a result of a recent settlement by the National Association of REALTORS® (NAR), Realtors involved in MLS and assisting homebuyers will be required to enter into written agency agreements with their clients beginning on August 17th, 2024. To address this change, Ohio REALTORS® advocated for standardizing this practice in state law, ensuring uniformity across Ohio’s real estate sector. By codifying this requirement, HB 466 will promote consistency among all real estate professionals, fostering transparency and mutual understanding in transactions.

The core of HB 466 is the requirement for licensed brokers and salespersons to enter into written agreements with their clients before showing a property for a seller or presenting an offer for a buyer. This includes activities such as marketing or showing properties for sellers and making purchase offers for buyers. Written agreements must include several key provisions:

- An expiration date,

- Information on fair housing and blockbusting laws,

- Whether the relationship is exclusive or nonexclusive,

- Terms of compensation, and

- A conspicuous statement that broker fees and commissions are not set by law, are fully negotiable, and may be paid by various parties or through sharing between brokers.

This law aligns Ohio with best practices already adopted in over 20 other states, including Indiana and Pennsylvania. "Ohio REALTORS® has long advocated for the use of written representation agreements," said a representative from Ohio REALTORS®. "This legislation marks a significant achievement in our efforts to promote transparency in real estate transactions across Ohio."

Ohio REALTORS® began working with lawmakers shortly after the NAR settlement was reached in March to provide clarity to the changing industry. With written agency agreements becoming a requirement for REALTORS®, they saw the need to establish a statewide standard for their usage. Sponsored by Jean Schmidt (R-Loveland) and Representative Brennan (D-Parma), this bill was introduced to provide the necessary framework for standardizing this practice.

"Ohio REALTORS® focused their advocacy efforts on educating lawmakers on the importance of this legislation," said an official from Ohio REALTORS®. The bill now heads to Governor DeWine’s desk for his signature.