Question: What is a listing agent’s statutory duty owed to prospective buyers to disclose facts about the integrity a listed one-to-four unit residential property?
Answer: A listing agent’s statutory duty owed to prospective buyers to disclose facts about the integrity of the physical condition of a listed one-to-four unit residential property is limited to his prior knowledge about the property and observations he made while conducting his mandatory visual inspection.
While property information must be reviewed for any untruthful statements known or suspected to exist by the listing agent, that listing agent has no further duty to investigate any of the information provided by the seller to authenticate its accuracy. [See first tuesday Due Diligence and Disclosures Chapter 9]
Question: What kind of license does a home inspector need?
Answer: Any individual who holds himself out as being in the business of conducting a home inspection and preparing a home inspection report on his findings during the inspection of a one-to-four unit residential property is a home inspector. No licensing scheme exists to set the minimum standard of competency or qualifications necessary to enter the home inspection profession.
For more information regarding home inspector qualifications, you can also refer to California Business and Professions Code Section 7195, which defines a “home inspection” and a “home inspector” according to California law. For additional insight, attached is Due Diligence and Disclosures Chapter 12, “The home inspection report.”
Question: When do you need a real estate license to be a property manager?
Answer: A real estate broker license must be held by an individual or corporation that, with expectation of a fee, offers to or performs any of the following services for another individual:
- List real estate for rent or lease;
- Market the property to locate prospective tenants;
- List prospective tenants for the rental or lease of real estate;
- Locate property to rent or lease;
- Sell, buy or exchange existing leasehold interest in real estate;
- Manage income-producing properties; or
- Collect rents from tenants of real estate. [Business and Professions Code §10131(b)]
An individual employed by a broker to act as his agent to perform any of the services requiring a license must also hold a Department of Real Estate (DRE) license, unless the agent is employed by the broker to handle residential complexes other than single family units. [Bus & P C §10131.01(a)(3)]
For agents employed to handle residential complexes other than single family units, activities are categorized as either:
- Licensed employee activities, such as landlord-related solicitations, listings and rental or lease negotiations, care and maintenance of the property, marketing of the listed space and accounting; or
- Unlicensed employee activities, such as tenant-related negotiations, showing properties, giving out leasing information, screening applications, and accepting rental or lease agreements, deposits and rent.
Individuals performing only unlicensed employee activities are not required to hold a real estate license.
Further, only licensed agents receive a contingent or percentage fee based on their production. Unlicensed employees must receive a flat salary and cannot be paid a fee contingent on their production or as a percentage of revenue.
Also exempt from licensing are the following individuals:
- Anyone who has been given authority to act as an “attorney in fact” under a power of attorney to temporarily manage an owner’s property [Bus & P C §10133(a)(2)];
- Apartment resident managers who only manage one apartment complex [Bus & P C §10131.01(a)(1)];
- Anyone acting as an attorney performing management as part of his legal services [Bus & P C §10133(a)(3)]; or
- Anyone acting under court appointments, such as a receiver or bankruptcy trustee. [Bus & PC §10133(a)(4)]