The Kansas Legislature formally adjourned on May 7^th.  Here is a summary of our major issues that passed this session:

The Legislature passed the conference committee report on HB 2315 Home Inspection Legislation.  After nine years of working on this issue, we have finally passed legislation that regulates the home inspection industry and prohibits them from limiting their liability for errors and omissions to less than $10,000. 

Below is an outline of the requirements for home inspectors under HB 2315:

• Establish a new, independent home inspection board made up of three home inspectors and two non-home inspectors to regulate the home inspection industry;
• Starting on July 1, 2009, all home inspectors providing services in counties with population greater than 60,000 will need to comply with the registration requirements (i.e. high school education, passage of an exam, carry general liability insurance, maintain financial responsibility for $10,000 in errors and omissions, belong to a national home inspection association that requires at least 16 annual hours of continuing education and obtain 80-hours of pre-inspection education);
• Starting on January 1, 2011, all home inspectors providing services in counties with population less than 60,000 will need to comply with the above registration requirements; and
• Starting on July 1, 2008, all home inspectors are prohibited from limiting their liability for errors and omissions to less than $10,000 per home inspection.

The conference committee report on HB 2772 Mandatory Appraiser Licensing passed on an overwhelming vote in the House and Senate.  This requires all appraisals conducted in the state to be conducted by licensed real estate appraisers.  Under the old law, appraisals on mortgages less than $250,000 that were not sold on the secondary market could be conducted by non-licensed appraisers.

Of particular concern on this issue, the final version of the legislation did include language allowing real estate brokers and salespersons to provide brokers’ price opinions and comparative market analyses to customers, clients and third parties for compensation.

 

New required radon language in the real estate contract was bundled together with the popular appraiser licensing legislation (HB 2772). We were not able to ask legislators to vote against this proposal.  However, in accepting the passage of this language, we were able to defeat the proposed mandatory testing and separate disclosure form (like lead-based paint) requirements. 

Starting on July 1, 2009, all residential real estate contracts in the state will need to contain the following language:

‘‘Every buyer of residential real property is notified that the property may present exposure to dangerous concentrations of indoor radon gas that may place occupants at risk of developing radon-induced lung cancer.  Radon, a class-A human carcinogen, is the leading cause of lung cancer in non-smokers and the second leading cause overall.  Kansas law requires sellers to disclose any information known to the seller that shows elevated concentrations of radon gas in residential real property.  The Kansas department of health and environment recommends all homebuyers have an indoor radon test performed prior to purchasing or taking occupancy of residential real property.  All testing for radon should be conducted by a radon measurement technician.  Elevated radon concentrations can be easily reduced by a radon mitigation technician.  For more information, please go to http://www.kansasradonprogram.org.”

The Legislature unanimously passed the Kansas Real Estate Commission’s legislation in the House and Senate.  KAR supported the various changes to the real estate license law included in this legislation.  Below is a brief summary of the major provisions in this legislation. 

• Increased the fines for basic real estate license law and BRRETA violations from $500 to $1,000;
• Created a new maximum fine of $5,000 for extremely serious violations such as forgery, mortgage fraud and intentional misrepresentation where fraud or deceit is proven;
• Provide the Commission with the authority to punish unprofessional conduct by real estate licensees such as the theft of personal property, harassment and physical abuse (attempted mortgage fraud language opposed by KAR was deleted by the House Commerce and Labor Committee);
• Prohibit advertising by real estate salespersons and salesperson teams where the name of the supervising brokerage is not prominently displayed; and
• Allow the Commission to spend a portion of the funds in the real estate recovery fund for consumer outreach and education on homeownership and other matters.

Legislation issues that KAR followed this session that did not pass included annexation, Home Builder’s request to change property taxes on unoccupied new construction, increasing the mortgage registration tax and the document recording fees, and  allowing insurance companies to increase the cost of homeowners’ insurance premiums without review by the Kansas Insurance Department.

If you are interested in having Luke Bell and Cindy Green present a Legislative Update at a future sales meeting for your office please contact Cindy at cindyg@kcrar.com or Luke at lbell@kansasrealtor.com.