NY may ban private home listings as more states crack down on controversial practice
New York State is on the verge of restricting private home listings marketed to an exclusive audience, making it the latest state to crack down on the controversial practice.The New York state Senate passed the “Fair and Transparent Real Estate Listing Act” in a vote of 60-0 from its noncontroversial calendar on Monday.The bill now heads to the desk of Gov. Kathy Hochul.Under this proposed law, real estate agents must market properties on free or publicly accessible channels, rather than through private or exclusive networks, unless the seller signs an agreement acknowledging they may receive fewer offers or a lower final price.New York would be the third state to put such a law on the books this year. Washington and Connecticut have passed similar laws.Lawmakers in Illinois and Hawaii have also proposed similar legislation.State Sen. Nathalia Fernandez (D-The Bronx) sponsored the New York bill and said the point of the measure was to ensure buyers see all the homes on the market, while sellers reach the widest possible audience.“For most families, buying or selling a home is one of the most significant financial decisions that they will ever make,” Fernandez said.
“Those decisions should be made in a marketplace where information is broadly available.Not hidden behind private networks that limit who can see the listings, and when they can see them.”Specifically, the bill requires that properties are advertised on a publication, platform, or website that’s free and or doesn’t require a homebuyer to work with the listing brokerage.
That marketing must commence immediately once the seller markets the property.The law does have a disclosure and opt-out form, which a seller must sign to authorize a private listing.The opt-out form warns that private listings will receive “reduced visibility to buyers and tenants” and “may reduce the number of offers” a seller receives.It also ups the fine for violation of real estate broker conduc...