REAL ESTATE LAW

Owning investment properties is often exciting and lucrative. However, investments in real estate, whether vacation rentals, long-term rentals, or properties for resale, can also create liabilities. Those liabilities make it critical for real estate investors to wisely choose how they will structure their businesses.

A new Chicago ordinance has introduced a pilot program for landlords within certain districts of the city, expanding the current pilot program already in place Woodlawn. If successful, this program may eventually be expanded further. For now, however, the Tenant Opportunity to Purchase Block (606) District Pilot Program (Chapter 5-11) is designed to provide tenants in Block 606 the right to be notified when their rental property is up for sale and, in many cases, to give them a Right of First Refusal (ROFR) to purchase the property.

Starting this Saturday, August 17, 2024, new rules go into effect for the National Association of Realtors (“NARS”) that change the way realtors will be paid their commission when representing people buying and selling homes. These new rules came about as part of a $418 million settlement by NARS in March, and effectively eliminate the existing informal payment structures that have historically been used by realtors. Until now, sellers of homes typically would sign listing agreements agreeing to pay anywhere from 4-6% of the purchase price in commission, which commission amount would then be split between their agent and the buyer’s agent. So, Buyers did not have to pay anything to their realtor for their assistance. The new rules could change that.

New legislation is changing how realtor commission is paid in a home sale and laws have been introduced in several states in response to various lawsuits regarding transparency in real estate broker commissions. Lavelle Law Shareholder Kelly Anderson and Realtor Cathy Betourne discuss the implications for buyers, sellers, realtors, and the closing process.