first tuesday recently had the opportunity to interview Wayne Bell, California’s new Real Estate Commissioner about his appointment and the future of the Department of Real Estate (DRE), soon to be known as the Bureau of Real Estate (BRE). We also posed several reader questions, chosen from the tremendous number of inquiries sent to us. Thanks for participating! If you enjoyed this feature, please let us know in the comments.
The office of the Real Estate Commissioner
Questions: How do you feel your experience as DRE chief counsel will help you in your role as commissioner? How about your background as a real estate broker? What have you learned from the legacies of past commissioners that you will bring to your term? Will you stay based in Sacramento, or move your office to SF or LA as past commissioners have done?
Mr. Bell steps into the position of Real Estate Commissioner with prior experience as the DRE’s Chief Counsel. As Chief Counsel, Bell prosecuted a high number of real estate fraud cases. He now turns that “prosecutorial filter” to protecting real estate consumers in his new role as Commissioner. Although Bell did not mention specifically any hands-on use of his real estate license, he stated his experience as a real estate broker provides him the training and education necessary to understand the challenges facing DRE licensees.
Bell takes the office at a time of transition. Though Bell has spoken with past Commissioners on the office, he feels that the current market has produced a different set of challenges, and a new potential for fraud.
Bell will remain in Sacramento.
The challenges ahead for the DRE
What do you feel are the biggest challenges facing the DRE? What steps will be taken to address these challenges? What additional actions or plans does the DRE have for enforcing real estate laws at the broker and agent level?
Commissioner Bell stated his number one goal is to expand the scope of the DRE’s public protections. According to Bell, 55% of DRE funds are currently spent on enforcement of DRE regulations. His major focuses will be unlicensed real estate practitioners, loan modification fraud, bankruptcy fraud and victimization of desperate homeowners who are trying to keep their homes.
In this effort, Bell encouraged anyone who knows of violations of real estate law, or unauthorized real estate practice, to call the DRE’s main office line in Sacramento (1-877-373-4542) and report the activity to the DRE’s enforcement staff.
DRE education and efficiency
In addition to our journal, first tuesday is also an approved DRE education provider. Do you anticipate changes to the qualifications for obtaining a DRE license, such as requiring a college degree or more stringent education requirements? How about an increase in licensing fees? What plans do you have to make the new DRE more efficient and accessible? Can we expect more online utilities for licensees to obtain, renew and process other documentation with the DRE?
According to Bell, the DRE is not currently advocating any changes to the DRE education requirements. Bell indicated that any major educational changes would have to come through the legislature. Licensing fees are not slated to change in the near future.
When confronted on the difficulty of reaching a live person for help at the DRE, Bell acknowledged the complaint. As a member of the public, Bell expressed his personal distaste for robotic voice menus. He assured us that efficiency was an issue he will address during his tenure.
Some technological innovations, such as the improved DRE website and eLicensing functionality, have already been completed. Bell was receptive to suggestions for improvements from the public on improving online features and customer service. Stay tuned for information on how to send this information to the DRE.
The DRE’s ties with CAR
Do you see Real Estate trade unions playing a role in the DRE as they have in the past?
Bell claims the DRE is not influenced by any trade unions, CAR in particular. Bell emphasized that he is not a member of any of those associations, but is willing to reach out to outside associations as part of his mission to improve the DRE.
The DRE’s reorganization as the BRE
What is the biggest change or impact of the DRE’s transition to the BRE under the Department of Consumer Affairs (DCA)?
As the DRE has stated previously, any changes stemming from the reorganization plan are difficult to foresee. Bell does recognize some positives of the reorganization: the DCA’s mediation program and enforcement department will provide much-needed assistance in pursuing and resolving consumer complaints.
When asked about how the reorganization will impact DRE staffing, Bell said the state budget would ultimately control that decision. (One of the goals behind the Governor’s reorganization plan was indeed to cut costs.) Press Officer Tom Pool indicated there may be some administrative staff eliminations, but both Bell and Pool reiterated that the core programs of the DRE will remain untouched.
Bell on the real estate market
In the current market, half of all buyers are speculators who completely neglect to obtain property disclosures. What are your thoughts on this potential problem? In your opinion, do real estate agents and brokers have a fiduciary responsibility to get a seller the lowest cost of title insurance, escrow services, home warranty, inspections, etc.?
Bell did not have a comment on the speculation issue, however he indicated that part of the fiduciary duty was to put the principal first and find the best services for clients. Price, while significant, is not the only factor to be considered.
And a little about Wayne Bell, the man
What are your hobbies and interests?
Bell’s favorite pastime is spending time with his teenage son. Other hobbies include landscape photography, human behavioral science, poetry and travel. He didn’t mention specific authors or poets, but he did mention that a favorite travel destination is the South Pacific.
first tuesday insight
The best indicator of a better future for the DRE? This commissioner is not a CAR man.
In 1976, Governor Brown (in his first term) appointed another independent, David H. Fox as Real Estate Commissioner. Fox championed consumer protection by ushering in continuing education requirements for licensees. More importantly, he developed and adopted the DRE Ethics and Professional Conduct Code (the Conduct Code) which succinctly codified existing case law on licensee conduct. The Conduct Code controlled licensee behavior with the full force of law.
Then, during the ‘90s, Governor Wilson repealed the code under the battle cry of less government regulation, less moralizing, less guidance! “They’re licensed, aren’t they? What need have they for DRE guidance?”
As it turns out, a great need. In their questions sent to us for Mr. Bell, many readers demanded accountability for unscrupulous licensee behavior. They desired transparency, and clarification.
It’s time to bring that Conduct Code back.
Now, some may ask, “Why do we need ANOTHER Code of Ethics, when CAR already has one?” Because the union’s Code of Ethics is a national organization thing, and has no bite behind its bark. Readers have told us, time and again, that a promise of ethical behavior does not make a person ethical. Thus, such a private code cannot provide the necessary consumer protection demanded by the public.
However, a state-mandated Conduct Code backed by the enforcement efforts of a tenacious DRE will go a long way towards healing the black eye on the face of the real estate industry. While Commissioner Bell’s answers were diplomatic, we’ll take him up on his suggestions for improving the DRE. Commissioner, bring back the DRE Ethics and Professional Conduct Code. Protect our public, and restore professional esteem to the licensees who ply their trade knowledgeably and ethically.
We’ll stay on top of these developments, and report them as they occur. Next month, we’ll be re-launching our “DRE Watch” feature to keep readers informed about happenings at the DRE. Stay tuned!