BILL ANALYSIS Ó
AB 1650
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Date of Hearing: April 13, 2016
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Lorena Gonzalez, Chair
AB
1650 (Frazier) - As Amended March 28, 2016
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Urgency: No State Mandated Local Program: NoReimbursable: No
SUMMARY: This bill, beginning January 1, 2018, revises the
disclosure requirements for real estate licensees with regard to
solicitation materials. Specifically, this bill:
1)Requires a real estate licensee to disclose his or her name,
license number, and responsible broker's identity on
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solicitation materials intended to be the first point of
contact with consumers and on real property purchase
agreements when acting as an agent in those transactions.
2)Expands the definition of "solicitation materials intended to
be the first point of contact with consumers" to additionally
include advertisements on television, in print, or electronic
media; "for sale," rent, lease, "open house," and directional
signs, and other materials designed to solicit the creation of
a professional relationship between the licensee and a
consumer.
3)Excludes from these provisions, "for sale," rent, lease, "open
house" and directional signs displaying only the responsible
broker's identity, or do not contain a reference to a real
estate licensee's name.
FISCAL EFFECT:
Minor and absorbable costs to the Bureau of Real Estate to
modify existing regulations.
COMMENTS:
1)Purpose. According to the author, "Current law has created
confusion about what identity information is required to be
included on real estate advertising materials. Existing law
varies greatly depending on the type of advertisement (i.e.
'for sale' signs, print and electronic media, business cards,
brochures, etc.) and the name being used by the licensee (i.e.
given name, nickname, team name, etc.). This bill will
require a licensee conducting advertising of any kind to also
include their California Bureau of Real Estate (BRE) license
number and responsible broker's identity. 'Open house' and
directional signs without a reference to agent name or
branding would be exempt from this requirement. Creating a
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uniform advertising standard for real estate licensees would
alleviate the existing competing standards and would serve to
create more transparency for consumers in the market place."
2)Background. Prior to 2008, there were no disclosure
requirements for real estate advertisements, other than to
state that the services being advertised require a real estate
license. After the onset of the housing market crisis, a
licensee was required to disclose his or her license number on
specified solicitation materials for consumer protection
purposes (SB 1461 (Negrete-McLeod), Chapter 284, Statutes of
2008). SB 1461 expressly excluded electronic and print
advertisements and "for sale" signs from this requirement.
AB 2018 (Bocanegra), Chapter 892, Statutes of 2014 clarified
and expanded disclosure requirements for real estate
advertisements under "fictitious business names" and "team
names" to include the responsible broker's identity. It also
expanded the scope of advertising and solicitation materials
to include online and print advertisements, as well as "for
sale", rent, and lease signs. The requirements of AB 2018,
however, do not apply to real estate licensees advertising
under their given names. Supporters argue that the
inconsistent standards have created some confusion among
licensees.
Analysis Prepared by:Jennifer Swenson / APPR. / (916)
319-2081
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