A bill to revamp District real estate licensure laws is under consideration by the City Council's public service and consumer affairs committee, chaired by Councilwomen Wilhelmina Rolark. No hearing date has been set yet.
The measure was requested by Mayor Marion Barry, who said that present laws "no longer are adequate to protect the public against deception, incompetence and fraud in real estate transactions."
The bill would require that deposits or other "trust money" received in a real estate transaction pending consummation of the sale must, with a minor exception, be deposited in a District financial institution.
Currently, some real estate operators deposit such funds in suburban institutions, said Lewis Wright, an official of the District's office of licenses and permits.
Wright said the proposed rule would make it easier to keep tabs on monetary transactions, for the benefit of the consumer.
The real estate legislation is generally supported by the real estate industry, according to James G. Banks, executive vice president of the Washington Board of Realtors.
The District Real Estate Commission also favors the bill, said Jean Oliver, acting chairman. Both the commission and the Washington Board of Realtors have worked with the administration on the measure. It was introduced by Council Chairman Arrington Dixon. Here are highlights:
Educational requirements for obtaining a license specifies the applicant must be a high school graduate or hold a general education diploma. In addition, 45 classroom hours of instruction are required for real estate salesmen and an additional 135 hours for brokers.
Currently the only education requirement is the ability to speak, read and write English, although an applicant must pass a real estate test within six months after receiving a temporary license. the new requirements do not apply to those already holding licenses.
The proposed new educational rules would put the District requirements on par with those of Maryland and Virginia and make possible reciprocity under which District licensees might be licensed in those states. this is a strong point with the real estate industry, Banks said.
The commission would be authorized to suspend a license for up to 90 days, without a hearing, where the panel finds a licensee's activities constituted a "clear and present danger of irreparable harm to the public."
The commission could reimburse complainants, who have obtained a court judgment for monetary claims against a licensee, for any difference between the amount awarded and the actual sum received by the claimants.
Funds for this would come from bond fees, now paid directly to bonding companies, which would be paid to the commission instead of to the bonding companies.
If the licensee fails to reimburse the commission for the money thus spent, with interest, his license would be suspended immediately.
Property managers and appraisers would also be regulated. Oliver said no statistics are kept on the number of complaints received in these areas, but said he believes that complaints are on the upswing.
Oliver said the general tenor of complaints about real estate professionals has to do with "competence to conduct business" and "misinformation."
No licenses were revoked last year or thus far this year, he said. There was one suspension last year and none so far this year, he said, but there are 15 cases pending hearing before the commission.
The present D.C. licensure law was adopted in 1937. Banks of the Washington Board of Realtors said that "different kinds of mortgage arrangements" practiced today, together with changes in zoning regulations, rent control and the complexities of condominium sales require more up-to-date laws.