By Steve Strode, Real Estate Commissioner - June 2022
The Agency comments periodically on trends we are observing, both to educate licensees on statute and rules and offer guidance that may reduce the chances of you being named in a formal complaint. Complaints may be filed by buyers and sellers, the general public, or fellow licensee as described on the Oregon Real Estate Agency's
website.
As we have commented previously (for example, see the
June 2021 Oregon Real Estate News-Journal), market conditions often affect business practices as licensees seek to advocate best for their clients. Everyone reading this knows that the residential real estate market has been hot for some time, with demand outpacing supply throughout Oregon. In a seller's market, much of the work in the transaction may be front-loaded, with listing agents and sellers having to review several or many offers. Shifting to a buyer's market, a seller may only get one offer after many months of ongoing work by the listing agent. Presenting offers in a seller's market can be fundamentally different than in a buyer's market — from faster-paced deadlines to the sheer volume of transaction documents that need to be reviewed by licensees and their clients.
Communication to all parties is key, irrespective of market conditions. It is when communication falls short that suspicions start to surface. In any competitive offer situation, there is the buyer whose offer is chosen, the possible backup offer(s), and all the other buyers who were rejected. Here at the Agency, we receive complaints from buyers who are concerned that their offers were never presented timely. It's not unheard of for a buyer whose offer was rejected to follow the transaction online to closing — especially if they are suspicious that a licensee “double-dipped" or the transaction was handled within the same brokerage, and all offers were not presented to seller.
This concern could have been avoided with better transparency and communication. However, a disaffected consumer feels compelled to file a complaint with the Agency against the listing broker. Then that licensee must provide a response to the Agency to demonstrate that they fulfilled their duties under
Oregon Revised Statute (ORS) 696.805(2)(b) and
Oregon Administrative Rule (OAR) 863-015-0135(2), (3) and (4). All of this takes licensees away from their core business.
So, what are your duties under statute and rule? Using this real example to illustrate:
Complaint: “The listing agent didn't present my offer. They didn't even send back a signed rejection by the seller."
ORS 696.805(2)(b) reads that a real estate licensee acting as a seller's agent is required to “present all written offers, written notices and other written communications to and from the parties in a timely manner without regard to whether the property is subject to a contract for sale or the buyer is already a party to a contract to purchase." See ORS 696.805 for the complete list of duties as a seller's agent.
OAR 863-015-0135(2), (3) and (4) outlines additional responsibilities for licensees:
(2) A real estate licensee must promptly deliver to the offeror or offeree every written offer or counter-offer the licensee receives.
(3) The licensee must maintain a written record of the date and time of each written offer or counter-offer delivered pursuant to section (2) of this rule and of the seller's or buyer's response. The licensee must maintain this record as required under OAR 863-015-0250, and if the seller rejects the offer or counter-offer, the licensee must provide a true copy to the offeror.
(4) When a licensee receives a written acceptance of an offer or counter-offer to purchase real property, the licensee must deliver within three banking days true, legible copies of the offer or counter-offer, signed by the seller and buyer, to both the buyer and seller.
You will notice that statute and rule do not require a seller to sign any documents. Statute and rule regulate licensee's behavior, but the Agency cannot compel a seller or buyer to act. However, your duties are not diminished. You are still required to maintain a record of the date and time offers and counter-offers are presented as described in OAR 863-015-0135(3). In an era of e-signatures, it is easier than in the past to both fulfill these obligations and provide full communication back to the buyer's agent and the buyer simultaneously.
So, while we recognize that fully documenting and obtaining signatures on all offers may take extra time for both a listing agent and clients in an era of multiple offers, I submit to you that it takes less time than responding to a complaint from the Oregon Real Estate Agency. And in those instances when a seller refuses to sign anything, please remember to document correctly and communicate appropriately to other parties in the transaction. Then, in the unlikely event a complaint does come in, your response to us can be concise with the issue quickly resolved.