Is 2024 the Year of Housing? What to look for in our next legislative session.

BY LISA MAY

Director of Advocacy and Public Policy for Maryland REALTORS

If you advocate for housing, but no one was around to hear—did you even make a sound?

When it comes to Maryland’s housing crisis, there have been times when REALTORS® must have felt like voices in the wilderness. While we have been sounding the alarm on what was once an 82,000-unit shortage that first grew to 120,000 units, and now to just shy of 150,000 units (per the National Low Income Housing Coalition), the General Assembly (read more about the General Assembly here) has been tackling legislation on everything but that issue.

This coming year, in 2024, it looks like our calls to act are being answered.

Housing Crisis: No Longer Just a REALTOR® Issue

The drumbeat on housing supply and affordability in Maryland appears to have grown too loud to ignore any longer. The Administration, key General Assembly Committees, and yes, even local governments, agree that a package of housing legislation will be introduced in the 2024 Session.

Early conversations among stakeholders indicate that these efforts will be focused on several aspects of the housing pipeline:

• Reforming the Permitting Process to Reduce Delays
• Reducing Litigation Over New Development
• Better Reporting on Local Housing Needs
• Preserving and Expanding Housing Programs

What remains to be seen is whether those measures will be enough to close the state’s now-estimated 150,000 housing unit shortage. Expect to hear much, much more on this in the coming months.

Industry Matters

Year in and year out, Maryland REALTORS® proposes legislation to improve the operation and conduct of the real estate industry. This year, those measures will include changes both big and relatively small.

First up is a change to state law, which would allow for submission of anonymous complaints to the Maryland Real Estate Commission (MREC) for advertising violations. Several states currently investigate complaints submitted without the name of the person bringing the complaint; however, this has not been possible in Maryland due to a requirement that complaints be made under oath by the accuser. Because advertising violations are readily apparent, REALTORS® believe this change can be made without raising due process concerns.

Another REALTOR® bill will address an inconsistency within the brokerage statute. Currently, real estate brokers may oversee one office, but office managers are not given a limit on the number of offices that they may supervise. Having to hire an office manager to expand to a second location can be a financial deterrent to a broker growing his or her business. This bill will allow brokers the same oversight of branch offices as is given to office managers.

Finally, Maryland REALTORS® will seek legislation to address recent changes to how continuing education (CE) is reported to MREC. Policies instituted by MREC this summer requiring expedited reporting of CE credits by real estate schools has placed a hardship on those providers, which could result in fewer class offerings or increased costs passed on to licensees. The Commission has also prevented licensees from renewing when their CE credits are not recorded in the licensing system by the renewal deadline. The reasons for these changes include a high number of licensees who completed education requirements at the last minute or who falsely certified that they had completed credits when they had not. REALTORS® will submit legislation to require licensees to complete CE credits 30 days before license expiration and restore longer timeframes for continuing education providers to report completed credits to MREC.

Protecting Consumers, Protecting Homeownership

One of the top issues for REALTORS® in 2024 will involve reforms to the Condo and HOA resale process. Our members continue to report excessive fees charged by Associations to obtain resale information, while the differing timelines and disclosure requirements between the acts cause confusion in sales transactions. Following the lead of our neighboring Virginia, Maryland REALTORS® will seek legislation to conform resale disclosures and timelines across Common Ownership Community types and to prohibit any fees which are not outlined in statute.

Even before the beginning of litigation over commissions, Maryland REALTORS® was drafting changes to the brokerage act on buyer brokerage compensation. This bill will clarify existing requirements to clearly state the amount of compensation owed to the buyer’s broker, who is responsible for paying it, and what actions entitle the broker to that compensation.

Once again, legislators will take up improving financial literacy among Maryland’s student population. Joining counterparts from the mortgage banking industry, REALTORS® advocated for legislation on the topic despite opposition from local school officials. However, we are also working with the Administration on non-legislative initiatives, such as through the Comptroller’s Financial Literacy Advisory Board, to broaden awareness among the population.

A related measure involves expanding upon the state’s First-Time Homebuyer Savings Accounts. When Maryland REALTORS® passed this initiative in 2021, several compromises were made to the program’s structure to win approval. Unfortunately, those resulted in making the accounts less attractive to first-time buyers. Working with the original bill sponsor, REALTORS® hope to allow family members to open accounts on behalf of a first-time buyer to maximize their savings timelines and gain wider adoption.

Real estate wholesaling practices continue to be an area of concern within Maryland. An MREC workgroup has discussed the issue, and members of the General Assembly have turned to REALTORS® for assistance in explaining wholesaling transactions and potential pitfalls for consumers. If successful with this year’s legislation, Maryland would join ten states that have licensed or required additional disclosures from real estate wholesalers so that consumers have transparency during a wholesale transaction.

Budget Clouds on the Horizon?

A session preview would not be complete without a word of caution on state finances. Back in the Spring, officials began sounding the alarms on declining revenue estimates and the need for future spending restraint. With the General Assembly giving more scrutiny to the fiscal impacts of new legislation and existing services, REALTORS® will need to stand up to preserve funding levels for state housing services like the Maryland Mortgage Program. Especially in this time of rising interest rates and unaffordability, Maryland must hold housing harmless in any proposed spending reductions.

All in all, 2024 is shaping up to be a busy and consequential session. Policy makers are listening, so let’s make it one that counts for housing.

Save the Date: Love & Legislation

If Maryland’s legislature is in session, then it’s time for another Maryland REALTORS® Lobby Day!

If you haven’t guessed by the headline: The 2024 Lobby Day will be held February 14, 2024, Valentine’s Day the perfect day for love…and legislation. Check mdrealtor.org and the HotSheet for more information.

But for now: Save the date, and we’ll see you in Annapolis!