Prompted by similar legislation in nine states, D.C. real estate agents are pushing for a measure that would shield them from lawsuits if they fail to disclose to buyers that a property for sale is owned by a person with AIDS.

The legislation, now before the D.C. Council, would exempt sellers and their agents from disclosing facts that "psychologically impact" a property but do not affect its physical value.

"There are a lot of prejudices involved with AIDS, a lot of misconceptions," said Don L. Denton, president of Dale Denton Real Estate. "We just wanted to make crystal clear what our legal responsibilities were."

The D.C. proposal, referred to as the "stigmatized housing" bill, was introduced in February by Council member John A. Wilson (D-Ward 2). The proposal exempts sellers and realty agents from disclosing if an owner is infected or suspected of being infected with the AIDS virus, or whether a murder, suicide or other felony has occurred on a property.

The proposal, initiated by the 4,300-member Washington D.C. Association of Realtors, is before the District Committee on Consumer and Regulatory Affairs. Wilson said the bill probably will be marked up by the committee this fall.

While it is unclear what impact the bill would have in conjunction with existing anti-discrimination statutes, the legislation reflects a popular national legal trend since the height of public fear of AIDS in the mid-1980s.

A private suit in 1985 in California focused attention on the extent of disclosure that real estate agents should make about the disease. The case, in which a home buyer with hepatitis sued a real estate agent for failing to disclose the illnesses of previous owners, was settled out of court.

But the suit prompted the California Association of Realtors to warn its members that they could be sued for invasion of privacy if they disclosed that a seller had AIDS but also might be sued by a buyer if they failed to disclose "material facts" about the house.

The California legislature subsequently passed a law reasserting the rights of persons with AIDS, holding that whether a property owner has the disease is not a "material fact" and need not be volunteered to a potential buyer. The legislature decided that a seller or broker must respond to a direct inquiry.

Similar laws have been enacted by Georgia, Oklahoma and Texas since 1987. Florida and Hawaii have gone further and completely exempted real estate agents from the need to disclose whether home sellers had AIDS or other diseases.

In response to another California suit involving a real estate agent who failed to tell a buyer that a property was the site of a multiple murder 10 years before, Nevada, Rhode Island and Oregon passed laws similar to the D.C. proposal including provisions for violent crime.

"The legislation protects people who are buying and selling and brokering property, and it is based on not catering to peoples' prejudices, which is good," said Roger Doughty, president of the Washington Gay and Lesbian Activist Alliance.

No such suits have been filed in the District to the knowledge of several large realty companies, the Washington D.C. Association of Realtors and the Gay and Lesbian Activist Alliance.

But some question the legal necessity of a disclosure exemption for real estate agents. The D.C. Department of Consumer and Regulatory Affairs argued in public hearings last month that the 1977 D.C. Human Rights Act already prohibits discrimination in real estate transactions against persons with AIDS.

But Wilson dismissed that claim and said the anti-discrimination statute is ambiguous and in any case requires complainants to go through several bureaucratic channels.

"If you have an opportunity to clarify something, why not clarify it," Wilson said.

An additional complication has been the 1988 amendments to federal fair housing laws, said Laurene Janik, general counsel of the National Association of Realtors.

The Department of Housing and Urban Development has contended that that act bars all disclosure of whether a property owner has AIDS, Janik said.

"HUD is taking the position that a truthful response by a broker to an inquiry by a buyer may be a violation of the law," Janik said. "We suggest our brokers don't talk about {AIDS}. Our position is that AIDS is not relevant."

The national realty group is negotiating with HUD to alter its interpretation so that agents will not be prosecuted for truthful responses.

But real estate agents say sufficient doubt remains about how much to disclose about home sellers to leave them vulnerable to litigation.

"We have a fiduciary responsibility to be honest and truthful to the buyer, but on the other hand we are breaking the law if we violate the privacy of the owner," said W. Howard Rooks, president and owner of Mount Vernon Realty Inc. "It puts the broker in a very difficult position.

"I do not feel we should have to disclose {if an owner has AIDS}," Rooks said. "We would not volunteer it because we do not think it is important to the buyer."