New Laws/Regulations

On February 3, 2025, Governor Murphy signed into law A-3894/S-2580, which updates fire safety standards set forth in the Uniform Fire Safety Act. The law took effect immediately.

The updated law removes the State of NJ requirement for the necessity of a portable fire extinguisher prior to the issuance of a certificate of occupancy or other certificate of inspection. Therefore, state law no longer requires that a premises be equipped with a portable fire extinguisher as a prerequisite to obtaining a certificate of occupancy or any other documentary certification of compliance.

Important note: However, while state law has eliminated the requirement for portable fire extinguishers, municipalities are able to enact/retain local ordinances which may impose the obligation to have portable fire extinguishers as a condition of obtaining the necessary certification of compliance. Therefore, it is recommended that you check with the municipality where the property is located for the most up-to-date requirements concerning portable fire extinguishers. We will update the requirements on the CBRR Extranet as we receive updates on municipality questions. Please relay this information to your office manager to assist us in updating the Extranet.

An new requirement to the to the Uniform Fire Safety Act that took also took effect on February 3, 2025 which concerns notice of secondary power sources (i.e. whole house emergency generation systems). The law now requires the installation of a label within 18 inches of the main electrical panel and the electrical meter warning of the danger associated with secondary power sources. More on how this is complied with to come. The Division of Fire Safety within the Department of Community Affairs is working on promulgating rules that elaborate on these updates. 

Overview

The Real Estate Consumer Protection Enhancement Act is a comprehensive update to New Jersey real estate law designed to:

• Increase consumer transparency

• Clarify agency relationships

• Formalize brokerage agreements

• Standardize disclosures across transactions

• Aligns NJ practices with evolving national standards (including post-settlement industry changes)

👉 In short: More documentation, earlier disclosures, and clearer representation rules.

🔑 Key Provisions (Agent-Focused)

1. Mandatory Written Brokerage Agreements

• Required before providing brokerage services to a buyer or seller

• Applies to:

  • Buyer representation (Buyer Brokerage Agreement)

  • Seller/listing representation (Listing Agreement)

  • Must clearly outline: Scope of services, Compensation terms, Duration of agreement

📍 Agent Impact:  No more “informal” working relationships—get it in writing early.

2. Designated Agency Now Permitted

• Brokerages can assign one agent to represent the buyer and another to represent the seller.  Both operate under the same brokerage company.

📍 Agent Impact: Reduces dual agency conflicts and creates true client-level representation within one brokerage

3. Clear Agency Disclosure Requirements

• Consumers must be informed of: Who represents whom and the type of agency relationship.  Applies early in the interaction process

📍 Agent Impact: You must disclose agency clearly and early, not mid-transaction.

4. Seller Property Condition Disclosure Requirement

• Sellers must complete a formal property condition disclosure statement and the statement covers known material defects.

📍 Agent Impact: Greater emphasis on accuracy and completeness and reduced reliance on informal/verbal disclosures

5. Open House Disclosure Rules

• Consumers attending open houses must be informed: Whether the agent represents the seller, of is working in another capacity.  A Notice must be posted.

📍 Agent Impact: No ambiguity—you must state your role upfront at open houses.

6. Compensation Transparency

• Requires clear disclosure of how agents are compensated and who is responsible for payment

• Aligns with broader industry lawsuit settlement changes around commissions

📍 Agent Impact: Expect more consumer questions about commissions—be prepared to explain clearly.

7. Enhanced Licensing & Education Requirements

• Updates continuing education requirements and adds a requirement for a course in “Agency”

📍 Agent Impact: Ongoing education will be less elective.

8. Standardization of Consumer Disclosures

• Creates more uniform forms and expectations across transactions

• Reduces inconsistency between agents and brokerages

📍 Agent Impact: More consistency, but less flexibility in how disclosures are handled.  

⚠️ What This Means for Your Day-to-Day Business

🔹 BEFORE

• Informal buyer relationships were common

• Agency often explained later

• Compensation discussions sometimes vague

🔹 NOW

• Written agreements upfront

• Agency defined immediately

• Compensation clearly explained

• Disclosures standardized and documented

🧠 Key Takeaways for Agents

• ✔️ Always secure a signed agreement early

• ✔️ Explain agency clearly—don’t assume understanding

• ✔️ Be transparent about compensation—no gray areas

• ✔️ Use updated forms and follow brokerage procedures

• ✔️ Treat disclosures as a critical compliance step, not a formality

White Paper on NJ Senate Bill No. 3192 May 16, 2024 

Written by Jim Joeriman,  June 1, 2024

Overview of Major Contents 

The contents of this whitepaper are not inclusive of everything in the proposed Bill. Some of the language herein is paraphrased. The Bill may undergo some revisions before it hits the Governors desk. This is provided you to give you an overview of the contents and provide a means for us to be better informed in order to make decisions regarding Company P&P, dialogs to the public and train our agents. While you are encourage to share the basic contents of this paper, please do not provide it to anyone without my approval. The Bill is 18-pages long, and I hope this saves you some time in understanding the contents and helps you know more than others. 

• Establishes Designated agency while maintaining Seller, Buyer, Dual agencies and Transaction Broker. • Providing the Property Condition Disclosure becomes law, including FSBO’s. 

• The CIS Statement becomes law. Changes to compliance requirements. 

• •Makes some changes to Continuing Education 

• Makes compensation payments from both seller and buyer clients legal 

• Establishes statutory duties to clients 

• Requires “Brokerage Services Agreements” (i.e. EBA) in order to receive compensation 

• Mandates an Agency Disclosure Notice at open houses. 

• Statutory obligation to obtain material financial qualifications 

• Stipulates that a seller’s agent is not required to submit any notice to the MLS stating that a seller has authorized the sharing of compensation. 

Definitions 

• Brokerage Services Agreement refers to Listing, Buyer Agency, and tenant agency agreements. 

• Material information is defined: means the existence or non-existence of information: ( 1) to which a reasonable person would attach importance in deciding whether or how to proceed with a transaction; or (2) that the agent knows or has reason to know that the recipient of the information regards or is likely to regard as important in deciding whether or how to proceed, although a reasonable person would not so regard it. Real Estate Transaction defined. In the definition, it states that a prospective transaction does not exist until a written offer has been signed by at least one party. 

STATUTORY DUTIES TO ALL PARTIES 

• Specifies duties owed to principals and to all parties in a transaction which cannot be waived. 

1. Exercise reasonable skill and care 

2. To deal honestly and in good faith. Give some thought to this and when clients don’t want to deal in good faith. 

3. Unless otherwise directed in writing by the principal: Duty to present all offers in a timely manner and to provide written confirmation of receipt to the other party on every written offer or counteroffer. 

4. Property Condition Disclosure. To obtain a signed property condition disclosure statement with it being required that the seller provide to the brokerage firm the statement with the information filled in and signed by the seller. If the seller is not represented by a brokerage firm, they must provide the statement to the buyer prior to there being a binding sales contract. Agent must disclose all existing material information known by the seller’s agent and not apparent or readily ascertainable to a buyer concerning the physical condition of the property that is for sale. 

5. Provide an accounting to the principal as necessary in a timely manner for all money and property received from or on behalf of any party to the transaction. I believe this to mean we will have to advise the client of receipt of all funds (probably P&P written). 

6. Consumer Information Statement Changes. In the past, the CIS was mandated under the Real Estate Commission Rules, it now becomes statutory. We must obtain a signed acknowledgment of receipt by the party. It must be provided as soon as reasonable practical but no later than at the time the party signs a brokerage services agreement. 

7. Agency written disclosure must be made as soon as reasonably practical but no later than at the time that of principal signing any brokerage service agreement: 1). The type of agency and 2) the terms of compensation, if any, offered by a party or the brokerage firm to another brokerage firm representing a different party 

8. Undertake a reasonable effort to obtain material information concerning the condition of every property for which the brokerage firm accepts an agency relationship, or is retained to market as a transaction broker. 

9. Undertake a reasonable effort to obtain material information concerning the financial qualifications of every person for whom the brokerage firm submits an offer to the brokerage firm’s principal. 

SECTION 3 BUYER AGENCY 

In my view this is better understood if referred to as Exclusive Buyer Agency 

1. A brokerage firm and its agents that performs real estate brokerage services for a buyer is a buyer’s agent unless: (The important point here is that you must be a buyers agent unless one of the following conditions exist) 

• The buyer is interested in a property listed with the same broker (sellers agent). 

• There is a buyer agency agreement and the buyer is interested in a property listed by the same broker (disclosed dual agent). • If there is a brokerage agreement with a buyer as a transaction broker. Consider the issue of compensation of this. 

• Should the broker/agent be the seller, or one of the seller’s they cannot be a buyers agent. 

2. Buyer Agency Agreement Required: In a residential real estate transaction, a brokerage firm shall enter into a brokerage services agreement with the buyer before, or as soon as reasonably practical after, the firm commences rendering real estate brokerage services to, or on behalf of the buyer. 

3. Buyer brokerage services agreements not required for commercial properties. 4. The language in the new buyer agency agreement is supported in this Bill. 

STATUTORY DUTIES TO THE BUYER 

Duties limited to the following and may not be waived.

1. To be loyal to the buyer by taking no action that is adverse or detrimental to the buyer’s interest in a transaction. 

2. To timely disclose to the buyer any conflicts of interest. 

3. To advise the buyer to seek expert advice on matters relating to the transaction that are beyond the agent’s expertise 

4. To not disclose confidential information from or about the buyer, except under subpoena, court ofer or otherwise as provided by law, or as expressly authorized by the buyer, even after termination of the agreement. 

5. Unless otherwise agreed to in writing, to make a good faith and continuous effort to find a property for the buyer. Exception to properties under contract surviving AR. 

6. The showing of a property in which a buyer is interested to another prospective buyers by a buyer’s agent shall not breach the duty of loyalty or create a conflict of interest. The same goes for a transaction broker. 

SECTION 4 SELLER AGENCY 

A brokerage firm and its agents that performs real estate brokerage services for a seller is a Seller’s agent unless: 

• The brokerage firm represents the buyer pursuant to a brokerage services agreement. 

• Written documents establish a dual agency situation (completely paraphrased). 

• The brokerage firm as agreed with the seller to be a transaction broker. 

• Conflict, the buyer is affiliated with the Listing Broker. 

There is required language for the listing agreement which is now statutory rather than regulatory. 

New language includes: 

1. Designated Agency: If the seller consents to the broker or “managing broker” appointing such. 

SECTION 7 DUAL AGENT 

Statutory Duties 

• 1. Take no action which is detrimental to either party’s interest in a transaction. 

• 2. Make timely disclosure of conflicts of interest to both parties. 

• 3. Advise both parties to seek advice on matters relating to the transaction which are beyond expertise. 

• 4. Non disclosure of confidential information. 

• 5. Make good faith and continuous effort to find a buyer for the property [while on the market]. 

• 6. Make a good faith effort to find a property for the buyer. Dual Compensation. “A disclosed dual agent in a real estate transaction shall be deemed to be acting in the same capacity with the buyer and the seller as a dual agent and may receive compensation through its brokerage firm from eith or both the buyer and seller provided that the sources and amounts of compensation are disclosed in writing to the buyer and the seller. 

SECTION 8 DESIGNATED AGENCY 

• 1. Dean will be able to authorize Mangers to designate agency. 

• 2. Each designated agency shall solely represent the party with whom the designated agent has an agency relationship. 

• 3. For the purposes of designated agency, the seller’s designated agent and the buyer’s designated agent are not dual agents and owe fiduciary duties solely to their respective principals. 

• 4. In order for a designated agency relationship to take effect, the brokerage firm shall enter into a written designated agency agreement that may be incorporated into the brokerage services agreement with each of the parties. This is in the EBA and we will add it into our CBRR Listing Agreements. 

• 5. Language affirms that a designated agent may receive compensation from either party provided the amounts of compensation are disclosed in writing to buyer and seller. 

Section 9 outlines the limitations on Transaction Brokers. 

Section 10 speaks to term of the agreements. Nothing new which is not already in the Listing Agreement or the EBA. With exception to a dual agency relationship: Absent a termination by expiration or fulfillment by a completed closing, brokerage services agreements between a disclosed dual agent and a buyer and seller shall otherwise only be terminated in writing signed by the buyer or seller, as applicable, with confirmed delivery to the disclosed dual agent. 

Section 11: Compensation.  A lot of the language here affirms industry standards already in practice. Some noteworthy language includes: • A buyer may agree that a buyer’s agent’s or transaction broker may share with another firm the compensation paid by the buyer, provided that this type of agreement is in writing. 

• Notwithstanding any law, rule, or regulation to the contrary, a brokerage firm may be compensated by more than one party for real estate brokerage services. 

• To receive compensation for rendering real estate brokerage services from any party, firm or third party, a brokerage firm shall have a written brokerage services agreement with the buyer or seller, as applicable... 

Section 12 - Catchalls 

• A brokerage firm shall not be liable for information that is to be disclosed by a seller in a property condition disclosure statement that is provided for by law or that the brokerage firm requested the seller to provide and was not provided to the brokerage firm. 

Section 14 - Open House Rule 

1. At any residential property showing that is generally open to the public, a sign shall be posted at the entrance or at a sign-in sheet clearly advising prospective buyers that the brokerage firm hosting the open house represents the seller only and has no relationship with the prospective buyer, except if the buyer does not have an exclusive buyer agency agreement with another brokerage firm and agrees to the seller’s agent becoming a disclosed dual agent or designated agent. WHEW! There is exact language provided for the this notice. 

Section 16 - COE 

1. Not less than 50 percent of the CE course of study which are required to be completed shall be comprised of one or more of the following topics: Agency, Disclosure, Legal Issues, Ethics (not less than 2-hour), Fair Housing, Rule and regulations, real estate license safety, financial literacy and planning and any other core topics that the NJREC may prescribe by rule. 

2. The NJREC shall require that a continuing education course on agency be completed as a condition for license renewal during each biennial license term.