Phil Querin Q&A - Resident Sales in Community – Tips for Management

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February 13, 2017
Phil Querin
MHCO Legal Counsel
Querin Law

 

Question:  When residents want to place their home on the market, we tell them we have a preferred real estate agent we want them to use.  Some residents oppose this and want to use their own agent they’ve already been working with.  How can we resolve this?  Also, is it permissible for us to insist that if they use their agent, we receive a portion of the commission at closing?  We have a similar arrangement with our preferred agent, and it’s worked out quite well. 

 

 

Answer:  Bad news on both fronts.  Let me answer your second question first. You may NOT share in a real estate commission unless you have your own Oregon real estate license.  This prohibition against commission sharing even applies between real estate agents and the homeowner they represent. Here is the applicable Oregon Law:

 

ORS 696.290 [Sharing compensation with or paying finders fee to unlicensed person prohibited]

 

(1)A real estate licensee may not offer, promise, allow, give, pay or rebate, directly or indirectly, any part or share of the licensees compensation arising or accruing from any real estate transaction or pay a finders fee to any person who is not a real estate licensee licensed under ORS 696.022 (Licensing system for real estate brokers and property managers). However, a real estate broker or principal real estate broker may pay a finders fee or a share of the licensees compensation on a cooperative sale when the payment is made to a licensed real estate broker in another state or country, provided that the state or country in which that broker is licensed has a law permitting real estate brokers to cooperate with real estate brokers or principal real estate brokers in this state and that such nonresident real estate broker does not conduct in this state any acts constituting professional real estate activity and for which compensation is paid. If a country does not license real estate brokers, the payee must be a citizen or resident of the country and represent that the payee is in the business of real estate brokerage in the other country. A real estate broker associated with a principal real estate broker may not accept compensation from any person other than the principal real estate broker with whom the real estate broker is associated at the time. A principal real estate broker may not make payment to the real estate broker of another principal real estate broker except through the principal real estate broker with whom the real estate broker is associated. Nothing in this section prevents payment of compensation earned by a real estate broker or principal real estate broker while licensed, because of change of affiliation or inactivation of the brokers license.

 

(2)Nothing in subsection (1) of this section prohibits a real estate licensee who has a written property management agreement with the owner of a residential building or facility from authorizing the payment of a referral fee, rent credit or other compensation to an existing tenant of the owner or licensee, or a former tenant if the former tenant resided in the building or facility within the previous six months, as compensation for referring new tenants to the licensee.

 

(3)(a) Nothing in subsection (1) of this section prevents an Oregon real estate broker or principal real estate broker from sharing compensation on a cooperative nonresidential real estate transaction with a person who holds an active real estate license in another state or country, provided:

 

(A)Before the out-of-state real estate licensee performs any act in this state that constitutes professional real estate activity, the licensee and the cooperating Oregon real estate broker or principal real estate broker agree in writing that the acts constituting professional real estate activity conducted in this state will be under the supervision and control of the cooperating Oregon broker and will comply with all applicable Oregon laws;

 

(B)The cooperating Oregon real estate broker or principal real estate broker accompanies the out-of-state real estate licensee and the client during any property showings or negotiations conducted in this state; and

 

(C)All property showings and negotiations regarding nonresidential real estate located in this state are conducted under the supervision and control of the cooperating Oregon real estate broker or principal real estate broker.

 

(b) As used in this subsection, nonresidential real estate means real property that is improved or available for improvement by commercial structures or five or more residential dwelling units.

 

As for requiring that residents use your preferred agent, that too is a No-No.  Here is that statute [I’ve underscored the applicable provision in subsection (1).] The term “services” can clearly be applied to real estate brokerage services, and as such, I cannot recommend that you impose that condition on residents when they want to sell their home.

 

90.525 [Unreasonable conditions of rental or occupancy prohibited.] 

 

(1) No landlord shall impose conditions of rental or occupancy which unreasonably restrict the tenant or prospective tenant in choosing a fuel supplier, furnishings, goods, services or accessories.

 

      (2) No landlord of a facility shall require the prospective tenant to purchase a manufactured dwelling or floating home from a particular dealer or one of a group of dealers.

 

      (3) No landlord renting a space for a manufactured dwelling or floating home shall give preference to a prospective tenant who purchased a manufactured dwelling or floating home from a particular dealer.

 

      (4) No manufactured dwelling or floating home dealer shall require, as a condition of sale, a purchaser to rent a space for a manufactured dwelling or floating home in a particular facility or one of a group of facilities. [Formerly 91.895; 1991 c.844 §7]