Real Estate Practice

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Environmental hazards:

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Dangerous elements or conditions present on the property that real estate agents should be aware of, and warn clients about, including asbestos, urea formaldehyde, radon, lead-based paint, underground storage tanks, water contamination, illegal drug manufacturing, mold, and geologic hazards.

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Blockbusting:

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Attempting to induce owners to list or sell their homes by predicting that members of another race or ethnic group, or people with a disability, will be moving into the neighborhood.

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Steering:

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Channeling prospective buyers or tenants to or away from particular neighborhoods based on their race, religion, national origin, or ancestry.

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Redlining:

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The refusal by a lender to make loans secured by property in a certain neighborhood because of the racial or ethnic composition of the neighborhood.

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Place of public accommodation:

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Any facility operated by a private entity and open to the public, where the operation of the facility affects commerce, such as a hotel, restaurant, theater, retail store, or service professional’s office.

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Conspiracy:

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An agreement or plan between two or more persons to perform an unlawful act.

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Price fixing:

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The cooperative setting of prices by competing firms. Price fixing is an automatic violation of antitrust laws.

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Group boycott:

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In the real estate profession, an agreement between two or more real estate brokers to exclude other brokers from equal participation in real estate activities.

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Tie-in arrangement:

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An agreement to sell one product, only on the condition that the buyer also purchases a different product. A tie-in arrangement is an automatic violation of antitrust laws.

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Market allocation:

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When competing brokers agree not to sell: 1) certain products or services in certain specified areas; 2) in specified areas; or 3) to certain customers in specified areas.

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1.

California’s Real Estate Law imposes certain restrictions on your listing activities. As a salesperson, you can be paid your commission only by your own broker. You can’t be paid by other brokers or sales agents, or by the principal. And you may not sue the principal for a commission; only the broker may sue the principal.

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2.

A listing agreement belongs to the listing broker. It is a contract between the property seller and the broker; you sign the listing agreement only as an agent of your broker. Should you stop working for the listing broker, the listing remains with the broker. You can’t take it with you to your new broker.

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3.

The federal Fair Housing Act prohibits discrimination based on race, color, religion, sex, national origin, disability, or familial status. In transactions related to housing, California antidiscrimination laws prohibit discrimination based on race, color, religion, ancestry, national origin, sex, gender, gender expression, gender identity, disability, medical condition, age, sexual orientation, marital status, familial status, genetic information, or source of income. Any discriminatory conduct by a real estate licensee is unlawful.

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4.

While dealing with potential clients and taking listings, you need to scrupulously follow all fair housing laws. Never imply that the presence of a particular group of residents will change property values or other characteristics of a neighborhood. Never refuse to list a property because of the seller’s race, national origin, or another protected characteristic. Avoid any kind of discriminatory slur, including telling racial or ethnic jokes or passively listening to them. You should also discuss fair housing laws with the seller before taking a listing. If you think the seller may discriminate against potential purchasers, refuse to take the listing.

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5.

When you advertise listed properties, make sure that all your advertising complies with fair housing laws. Never send flyers or choose advertising media based on discriminatory ideas, and make sure any models included in ads do not present discriminatory implications. Remember to include the fair housing logo or slogan in your ads.

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6.

Antitrust laws prohibit price fixing, group boycotts, tie-in arrangements, and market allocation. To avoid charges of price fixing, you should never discuss your commission rates with competing agents, and you must be sure to explain to sellers that the commission rate is fully negotiable. Never use a listing agreement form that has a commission amount or rate already set.

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7.

You should be familiar with the basic provisions of several environmental laws, including the National Environmental Policy Act (NEPA), the California Environmental Quality Act (CEQA), the California Coastal Act, and the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA). CERCLA is particularly important, because it may impose liability on present owners for the cost of cleaning up hazardous substances, regardless of fault.

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8.

Environmental hazards you need to be aware of include asbestos, urea formaldehyde, radon, lead-based paint, underground storage tanks, water contamination, the effects of illegal drug manufacturing, mold, and geologic problems. You must be able to recognize potential environmental hazards in a listed property, and advise the seller to consult an environmental professional when it is appropriate to do so.