Committee hears hours of testimony on bill to limit buyer-agency agreements; author voluntarily defers bill

House Committee on Commerce members heard extensive testimony April 22 on House Bill 139, a proposal from Representative Shane Mack to limit when buyer-broker agreements are required and to require clearer information about buyer-agent compensation in real estate advertising.

Mack told the committee his bill would make clear “you don't have to sign a buyer's agreement before you view a piece of property,” and said the proposal is meant to increase transparency in listings and advertising. He said some buyer agreements can run multiple pages and include commission details that prospective purchasers do not read before a showing.

The bill drew sustained questioning from committee members about legal risk and the fallout from a recent national real estate class-action settlement. Representative Hebert, a broker with more than 20 years in the industry, urged caution, saying the settlement and related Department of Justice scrutiny create uncertainty and that the Legislature should “watch and see how this plays out in the next year.” Representative Newell, an attorney, pressed Mack for precise definitions in the bill for terms such as “accurate representation” and “residential property.” Mack replied that the bill’s language is drawn from Louisiana Real Estate Commission (LREC) rules and that the LREC requires advertising be “an accurate representation of the property advertised.”

Multiple brokers and agents testified during the public-comment period. Carla DeYoung, a broker and state-certified appraiser, said the buyer-agreement form being discussed had been described to the public as a law when it is a practice tied to association rules; she testified that in practice MLS membership rules and lead generation have changed how consumers contact listing agents. Tammy J. Williams said she and other buyers have signed agreements under pressure and that some consumers later felt “coerced into doing that.” Carlos Alvarez, a broker who represents many agents, said the current practice “holds buyers hostage” and called for clearer, public disclosure of buyer-agent compensation so buyers can compare listings fairly.

Committee members also debated market realities: Representative Boyd and others explained that many buyers use listing agents or open houses and are not always represented by a buyer’s agent; several industry members countered that after the national settlement sellers may no longer routinely pay buyer-agent commissions, prompting buyer-agents to require signed compensation agreements to be paid.

The committee adopted a single technical amendment (Amendment set 1394) that changed some language (for example, replacing “broker” with “agent” in one line and clarifying the timing “when the offer is made to purchase”). After receiving multiple public witnesses and deliberating, Mack said he would “voluntarily defer this and bring it back maybe at a later date.” A prior motion to involuntarily defer was withdrawn; the final motion to defer the bill carried without objection.

The record shows broad disagreement about how state law should respond to national litigation and association rule changes. Several committee members urged more study and a limited delay to allow for coordinated language and review of possible federal litigation exposure. Mack said he appreciated the testimony and would continue working with stakeholders.

Votes at a glance: The committee adopted Amendment set 1394 (offered by Representative Green) and later accepted the author’s motion to voluntarily defer House Bill 139; no roll-call tallies were recorded on the floor for the amendment or the deferral in the transcript.