Regular Session 2017-2018 House Bill 0863 P.N. 0969

PRINTER'S NO. 969

THE GENERAL ASSEMBLY OF PENNSYLVANIA

HOUSE BILL

No.

863

Session of

2017

INTRODUCED BY ROTHMAN, KINSEY, SANTORA, DAVIS, R. BROWN,

A. HARRIS, MARSICO, WATSON, STEPHENS, KORTZ, QUIGLEY, BAKER,

DRISCOLL, CARROLL, CUTLER, ROE, GODSHALL, PHILLIPS-HILL,

LONGIETTI, MASSER, SAYLOR, KNOWLES, HELM, BRIGGS, DEASY,

IRVIN, RYAN, TOEPEL, NEILSON AND MARKOSEK, MARCH 16, 2017

REFERRED TO COMMITTEE ON PROFESSIONAL LICENSURE, MARCH 16, 2017

AN ACT

Amending the act of February 19, 1980 (P.L.15, No.9), entitled

"An act establishing the State Real Estate Commission and

providing for the licensing of real estate brokers and

salesmen," in definitions, further providing for definitions;

in qualifications and applications for licenses and

registration certificates, further providing for

qualifications for license; in duties of licensees, further

providing for comparative market analysis disclosure and

providing for broker price opinion; and making a related

repeal.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1. The definition of "comparative market analysis"

in section 201 of the act of February 19, 1980 (P.L.15, No.9),

known as the Real Estate Licensing and Registration Act, is

amended and the section is amended by adding definitions to

read:

Section 201. Definitions.

The following words and phrases when used in this act shall

have, unless the context clearly indicates otherwise, the

meanings given to them in this section:

* * *

"Broker price opinion." An estimate prepared by a broker,

associate broker or salesperson that details the probable

selling price of a particular parcel of real property and

provides a varying level of detail about the property's

condition, market and neighborhood, and information on

comparable sales, but does not include an automated valuation

model as defined in section 1125(d) of the Financial

Institutions Reform, Recovery, and Enforcement Act of 1989

(Public Law 101-73, 12 U.S.C. 3354(d)).

* * *

"Comparative market analysis." [A written analysis, opinion

or conclusion by a contracted buyer's agent, transactional

licensee or an actual or potential seller's agent relating to

the probable sale price of a specified piece of real estate in

an identified real estate market at a specified time, offered

either for the purpose of determining the asking/offering price

for the property by a specific actual or potential consumer or

for the purpose of securing a listing agreement with a seller.]

A written analysis, opinion or conclusion by a broker, associate

broker or salesperson relating to the probable sale or rental

price of a specified parcel of real property in an identified

real estate market at a specified time, which is prepared for

any of the following:

(1) An existing or potential seller, buyer, lessor or

lessee of a parcel of real property.

(2) A person making decisions or performing due

diligence related to the potential listing, offering, sale,

option, lease or acquisition price of a parcel of real

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property.

* * *

"Short sale." A sale of a house in which the proceeds fall

short of the amount the owner owes on the mortgage.

* * *

Section 2. Section 521 of the act is amended and the section

is amended by adding a paragraph to read:

Section 521. Qualifications for license.

Each applicant shall as a condition precedent to obtaining a

license, take the salesperson license examination and score a

passing grade. Prior to taking the examination:

(1) The applicant shall be at least 18 years of age.

(2) [The] The following apply:

(i) Except as provided under subparagraph (ii), the

applicant shall have completed [60] 75 hours in real

estate instruction in areas of study prescribed by the

rules of the commission, which rules shall require

instruction in the areas of fair housing and professional

ethics.

(ii) An applicant shall be required to complete 60

hours of real estate instruction as prescribed under

subparagraph (i) if the applicant has completed a portion

of the hours before the effective date of this

subparagraph. An applicant who has not completed any of

the required hours of real estate instruction before the

effective date of this subparagraph shall complete 75

hours of real estate instruction within five years of

taking the salesperson license examination.

(3) The applicant shall be a high school graduate or

shall produce proof satisfactory to the commission of an

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education equivalent to high school preparation. This

paragraph shall not apply to a person licensed before the

effective date of this paragraph.

Section 3. Section 608.3 of the act is amended to read:

Section 608.3. Comparative market analysis disclosure.

(a) A comparative market analysis must contain the following

statement printed conspicuously and without change on the first

page:

This analysis has not been performed in accordance with

the Uniform Standards of Professional Appraisal Practice

which require valuers to act as unbiased, disinterested

third parties with impartiality, objectivity and

independence and without accommodation of personal

interest. It is not to be construed as an appraisal and

may not be used as such for any purpose.

(b) A comparative market analysis prepared in accordance

with this act shall not be deemed to be an appraisal within the

scope of the act of July 10, 1990 (P.L.404, No.98), known as the

"Real Estate Appraisers Certification Act."

be paid to the broker.

Section 4. The act is amended by adding a section to read:

Section 608.6. Broker price opinion.

(a) A broker price opinion must contain the following

statement displayed conspicuously and without change:

This analysis has not been prepared in accordance with

the Uniform Standards of Professional Appraisal Practice

which require valuers to act as unbiased, disinterested

third parties with impartiality, objectivity and

independence and without accommodation of personal

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interest. It is not to be construed as an appraisal and

may not be used as such for any purpose.

(b) A broker price opinion prepared in accordance with this

act shall:

(1) Not be deemed to be an appraisal within the scope of

the act of July 10, 1990 (P.L.404, No.98), known as the "Real

Estate Appraisers Certification Act," or a valuation of real

estate for purposes of section 8(b)(1) of the act of February

2, 2012 (P.L.30, No.4), known as the "Appraisal Management

Company Registration Act."

(2) Be deemed to be a comparative market analysis for

the purposes of the "Appraisal Management Company

Registration Act."

electronically by the person who prepared it and must contain

all of the following information:

(1) An identification of the intended users and intended

uses of the broker price opinion, if known.

(2) A brief description of the subject property and the

property interest to be priced.

(3) The basis for the conclusion as to the price,

including applicable market data or capitalization

computation.

(4) Any assumption or limiting condition.

(5) Any existing or contemplated interest of the

licensee who prepared the broker price opinion.

(6) The effective date of the broker price opinion and

the date that the document is signed.

(7) The real estate license number of the preparer.

(d) Any fees charged for a broker price opinion shall be

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paid to the broker.

(e) A broker price opinion may be prepared by a broker,

associate broker or salesperson only for use in conjunction

with:

(1) a property owned by a lender after an unsuccessful

sale at a foreclosure auction;

(2) a modification of a first or junior mortgage or

equity line of credit;

(3) a short sale of a property;

(4) an evaluation or monitoring of a portfolio of

properties; or

(5) the relocation of an individual who is the owner of

a property or a prospective purchaser of a property.

(f) A broker price opinion may not be used:

(1) as the basis to determine the value of a parcel of

real property for a mortgage loan origination, including a

first or junior mortgage, refinancing or equity line of

credit; or

(2) in connection with:

(i) an eminent domain proceeding;

(ii) a Federal, State or local tax appeal;

(iii) a bankruptcy or insolvency proceeding;

(iv) an action or proceeding involving divorce or

equitable distribution of property; or

(v) any other action or proceeding before a court of

record.

(g) The provisions of this section shall not preclude the

preparation of a broker price opinion to be used in conjunction

with or in addition to an appraisal.

(h) A registered appraisal management company may recruit,

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engage and negotiate fees with a broker to prepare broker price

opinions and may receive orders for and submit broker price

opinions to clients.

(i) A broker, associate broker or salesperson may not

prepare a broker price opinion, and a broker or associate broker

may not sign a broker price opinion under subsection (j), unless

the broker, associate broker or salesperson:

(1) has satisfied the requirements prescribed by the

rules of the commission to obtain education in the

preparation of broker price opinions; and

(2) has completed at least three hours of continuing

education during the current or immediately preceding

two-year license period in broker price opinion topics

prescribed by the rules of the commission.

(j) In addition to the requirements under subsection (i), a

salesperson may not prepare a broker price opinion unless the

salesperson has held an active license for the three years

immediately preceding the effective date of the broker price

opinion. A broker price opinion prepared by a salesperson must

be signed by the broker or an associate broker designated by the

broker in addition to the salesperson.

(k) In order to facilitate the prompt implementation of this

section, regulations promulgated by the commission shall be

deemed temporary regulations which shall expire no later than

three years following the effective date of this section. The

commission may promulgate temporary regulations which shall not

be subject to:

(1) Sections 201, 202 and 203 of the act of July 31,

1968 (P.L.769, No.240), referred to as the Commonwealth

Documents Law.

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(2) The act of June 25, 1982 (P.L.633, No.181), known as

the "Regulatory Review Act."

(l) The authority provided to the commission to adopt

temporary regulations under subsection (k) shall expire three

years from the effective date of this section. Regulations

adopted after that date shall be promulgated as provided by law.

Section 5. Repeals are as follows:

(1) The General Assembly declares that the repeal under

paragraph (2) is necessary to effectuate this act.

(2) The act of July 10, 1990 (P.L.404, No.98), known as

the Real Estate Appraisers Certification Act, is repealed

insofar as it is inconsistent with this act.

Section 6. This act shall take effect in 60 days.

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