Modernizing Real Estate Regulations: Updates to the Agency Law

As of January 1, 2024, significant revisions to Washington's Real Estate Agency Law, RCW 18.86, will come into effect, marking a long-awaited modernization of the legislation. This law, commonly referred to as the "Agency Law," aims to enhance transparency, bolster consumer protections, and acknowledge the importance of buyer representation in real estate transactions.

Key Revisions

One of the most notable changes involves the requirement for real estate brokerage firms to establish written "brokerage services agreements" with all parties they represent, including both sellers and buyers. Previously, firms were only mandated to enter into written agreements with sellers. This update ensures that buyers are equally informed about the terms of the firm's representation and compensation.

The new services agreement with buyers will include essential details such as:

• The duration of the agreement, typically set at 60 days with options for extension.Identification of the broker assigned as the buyer's agent.
• Clarity on whether the agency relationship is exclusive or non-exclusive.
• Buyer's consent to the broker representing both parties in a transaction (limited dual agency).
• Buyer's consent to the broker's designated broker/ managing broker's limited dual agency.
• Compensation terms, including the amount and responsibility for payment.
• Any additional agreements between the parties.
• Additional Consumer Protections

In addition to the changes regarding representation agreements, the revised law also introduces enhanced consumer protections related to the duties owed by brokers to all parties involved in a transaction.

Revised Pamphlet

To help stakeholders navigate these revisions, the pamphlet titled "Real Estate Brokerage in Washington" has been updated to provide a comprehensive overview of the revised Agency Law.

Accessing the Revised Law

For those interested in a detailed understanding of the updated regulations, Substitute Senate Bill 5191 outlines the revised Agency Law in its entirety.

These revisions represent a significant step forward in ensuring fairness, transparency, and clarity in real estate transactions, benefiting both buyers and sellers alike.