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Happy New Year!
As we welcome the New Year, the North Carolina Real Estate Commission extends its heartfelt gratitude to all real estate brokers for their hard work and dedication. Your professionalism and commitment to the profession continue to elevate the standards of real estate brokerage in North Carolina.
This year, we wish you success, growth, and new opportunities in your real estate career. The Commission is here to support you by providing educational resources and guidance on regulatory compliance. As you navigate the dynamic real estate market, we encourage you to stay up to date with License Law and Commission Rules.
For any questions about License Law and Commission Rules, or permissible brokerage activities, feel free to contact Regulatory Affairs at regulatoryaffairs@ncrec.gov.
May the year ahead bring you happiness and success in all your real estate endeavors!
Year End Wrap-Up
It’s been a busy year at the Real Estate Commission, and as we wrap up 2024 and look towards 2025, let’s review some of the major events of the year.
The NAR Settlement
First on every REALTORS®’ mind: the National Association of Realtors’ settlement. While the settlement applies only to brokers who are members of the Association, it has had a broad impact on brokerage practice. If you haven’t heard about this then your license must be expired or inactive and you need to reinstate it before December 31, 2024 (hint, hint).
In November 2024, final court approval was granted in the nationwide anti-trust class action lawsuit that alleged that NAR’s practices inflated broker commissions. NAR agreed to two rule changes that went into effect in August prior to the approval of the settlement. First, REALTORS® can no longer include the buyer agent’s compensation when listing homes on the MLS. Second, buyers can negotiate their own agent’s pay and formalize it in a signed contract.
First, let’s distinguish between brokers and REALTORS®. The Real Estate Commission licenses brokers, but REALTORS® are licensed brokers who are also voluntary members of the NAR trade association. One does not have to be a REALTOR® to be a broker, but you must be a broker to be a REALTOR®.
Second, please remember that Rule 21 NCAC 58A .0104 already requires that all agency agreements must be in writing. So, while the new NAR rule change calls for a signed contract between the buyer and their REALTOR® that addresses compensation, the Real Estate Commission has required this for some time now and it is not a new requirement in North Carolina. What is new is the timing, and that applies only to REALTORS®. They must now have an agreement signed prior to touring a home with a buyer.
Revised RPOADS
The Commission revised the Residential Property and Owners’ Association Disclosure Statement (RPOADS) effective July 1, 2024. While the new RPOADS has a slightly different format and larger font, most of the questions remained the same with the addition of more detailed questions addressing flooding and related issues.
As a reminder, the RPOADS is used for residential properties and is filled out by the seller, not the broker. As to sellers, North Carolina is an “as is/buyer beware/caveat emptor” state (however you want to say it), which means an unlicensed seller may choose not to disclose any material facts by selecting “no representation” (the “NR” circle on the RPOADS). However, if the seller is a licensed broker, they are required to comply with Commission rules, which require aevery broker to disclose any material facts about the property that they know or should reasonably know, even in personal transactions. So even if the seller chooses to not disclose, the broker still must. And while it’s not a requirement, the best practice would be to disclose it in writing!
Trending in 2024
Fraud continues to plague the real estate industry throughout the country. Seller imposters, identity theft, and wire fraud are on the rise as consumers have reported losing out on billions of dollars per year to various types of scams. Know the red flags and always verify information to ensure that you are protecting the best interests of your clients and helping to prevent fraudulent activity.
What Comes Next?
As we move into 2025, the Commission continues to move forward with proposed rulemaking. The proposed changes can be found on the Commission’s homepage under License Law and Rule Changes. The public comment period opens on January 15, 2025, and we encourage you to submit your comments in writing to Public.Comment@ncrec.gov by March 17, 2025. In addition to the comment period, the Commission encourages you to attend the February 2025 public hearing on the proposed rule changes in High Point.
And finally, Happy New Year to all of our licensees and educators from the Commission and its Staff.
Disciplinary Actions
RACHEL L ALLES (CHARLOTTE) – By Consent, the Commission reprimanded Alles effective November 13, 2024. The Commission found that Alles, acting as the broker-in-charge of Higher Tech Realty NC LLC, supervised a listing agent who had been licensed for over 18 years. The listing agent’s seller-client completed a Residential Property Owners’ Association Disclosure Statement, and marked the property as having city water, city sewer, septic, and a private well. Alles was the broker-in-charge responsible when the listing was placed on the Multiple Listing Services (“MLS”), in which the property was described as having city water, city sewer, and septic. The listing agent misrepresented the property as being on city water when in fact it was served by a shared well. After closing, the buyer discovered the property did not have city water, and that the well was a shared well. Alles failed to ensure the advertisement for the property was accurate.
ASSISTANCE IN THE JOURNEY LLC (WINSTON-SALEM) – By Consent, the Commission suspended the real estate firm license of Assistance in the Journey LLC for a period of 9 months, effective December 15, 2024. The Commission then stayed the suspension in its entirety upon certain conditions. The Commission found that Assistance acted as designated listing brokers providing services for Assistance’s seller-client. Assistance misrepresented the heated square footage (“SF”) in its advertising. After the purchase, the buyer discovered that the advertised SF was 25% greater than the actual SF. A private settlement has been reached with the buyer.
JOHN F BARNHART (SANFORD) – The Commission accepted the permanent voluntary surrender of the real estate license of Barnhart, effective December 11, 2024. The Commission dismissed without prejudice allegations that Barnhart violated provisions of the Real Estate License Law and Commission Rules. Barnhart neither admitted nor denied misconduct.
MICHELLE B BENNETT (CHARLOTTE) – By Consent, the Commission reprimanded Bennett effective December 31, 2024. The Commission found that in August 2023, Bennett failed to verify whether homeowner association covenants allowed for the rental of the subject property.
HEIDI E CHRISTIE (WINSTON-SALEM) – By Consent, the Commission suspended the broker license of Christie for a period of 30 months, effective December 15, 2024. The Commission then stayed the suspension in its entirety upon certain conditions. The Commission found that Christie acted as co-listing agent in a designated dual agency transaction. Christie misrepresented the heated square footage (“SF”) in advertising. Christie hired a photographer who was not licensed as an appraiser or real estate broker to provide measurements and failed to review the advertising and measurements for accuracy. After the purchase, the buyer discovered that the advertised SF was 25% greater than the actual SF. A private settlement has been reached with the buyer. Christie attended trainings for brokers on SF representation and signed documentation attesting that the measurements adhered to firm policy when they did not.
CRYSTAL G FRANKLIN COPAS (SANFORD) – By Consent, the Commission suspended the broker license of Copas for a period of 6 months, effective November 15, 2024. The Commission then stayed the suspension in its entirety upon certain conditions. The Commission found that in June 2023, Copas listed property owned by an investor. Copas failed to include the types of agency offered on the WWREA disclosure, and failed to include the effective date, expiration date, and agency authorization in the listing agreement, but later rewrote both to include omitted information. A buyer went under contract for the property and emailed Copas the valuation from the buyer’s VA appraisal including a list of repairs to which the valuation was subject. The seller completed a septic repair and had plumbing issues inspected but the buyer terminated the contract when the buyer could not make up the difference in the VA appraised value. Copas failed to fully disclose the VA-identified remaining repair issues to the second buyer. The second buyer terminated in part due to inspection issues and newly discovered title issues and received a partial refund of the due diligence fee. Copas received the second buyer’s inspection report and provided that inspection report to the final buyer.
MARINA J DANE (CAROLINA BEACH) – The Commission revoked the real estate broker license of Dane, with no eligibility to apply for reinstatement for a period of 1 year from the effective date of December 11, 2024. The Commission found that on or about July 5, 2023, Dane fraudulently scheduled a showing at a property listed for sale so that she could access the property for her own personal use.
AIMEE L GENDRICH (JACKSONVILLE) – By Consent, the Commission reprimanded Gendrich effective December 15, 2024. The Commission found that Gendrich served as property manager for a landlord residing out of the country. Gendrich failed to conduct an inspection of the residence upon entering into the property management agreement and failed to conduct an inspection of the residence when the tenant vacated. In separate sales transactions in which Gendrich represented buyer-clients, Gendrich failed to deliver a detailed and accurate copy of the closing statement and properly identify repair requests in the Due Diligence Request and Agreement.
HIGHER TECH REALTY NC LLC (CHARLOTTE) – By Consent, the Commission reprimanded Higher Tech Realty NC LLC effective November 13, 2024. The Commission found that in September 2022, the Firm acted as listing agent for a property owner. The seller-client completed a Residential Property Owners’ Association Disclosure Statement and described the property as having city water, city sewer, septic, and a private well. The Firm advertised the property on the Multiple Listing Services (“MLS”), as having city water, city sewer, and septic, misrepresenting that the property was on city water when in fact it was on a shared well. After closing, the buyer discovered the property did not have city water, and that the well was a shared well. The Firm failed to ensure the MLS listing for Subject Property was accurate.
LANTERN REALTY & DEVELOPMENT LLC (KANNAPOLIS) – By Consent, the Commission reprimanded Lantern Realty & Development LLC effective December 11, 2024. The Commission found that in or around May 2023, the Firm listed a residential property and advertised the property as “[t]his home has been fully remodeled; new roof, HVAC, water heater, electrical and plumbing.” After closing on the property, the buyer discovered the electrical did not meet code requirements and paid to have the electrical service updated from 75 amps to 200amps. The Firm failed to disclose the property was not renovated in compliance with the law and misrepresented it in the advertisement.
ASHLEY S LAY (WINSTON-SALEM) – By Consent, the Commission suspended the broker license of Lay for a period of 30 months, effective December 15, 2024. The Commission then stayed the suspension following a 1-month active period upon certain conditions. The Commission found that Lay acted as co-listing agent in a designated dual agency transaction. Lay misrepresented the heated square footage (“SF”) for the subject property in advertising. Lay also acted as seller’s agent for the sellers in their purchase of the property and had access to information indicating that the advertised number was wrong. After the purchase, the buyer discovered that the advertised SF was 25% greater than the actual SF. Lay attended trainings for brokers on SF representation and signed documentation attesting that the measurements adhered to firm policy. A private settlement has been reached with the buyer.
JOHN K LAY (WINSTON-SALEM) – By Consent, the Commission reprimanded Lay effective December 15, 2024. The Commission found that Lay acted as broker-in-charge for a licensed team. The team and Firm advertised the subject property and misrepresented the heated square footage (“SF”). After the purchase, the buyer discovered that the advertised SF was 25% greater than the actual SF. Lay failed to ensure his firm’s advertisements were accurate and that affiliated brokers adhered to firm policies. A private settlement has been reached with the buyer.
SHAWN K MAYERS (KINSTON) – The Commission accepted the voluntary surrender of the real estate broker license of Mayers, effective December 11, 2024, with no right to reapply for 2 years. The Commission dismissed without prejudice allegations that Mayers violated provisions of the Real Estate License Law and Commission Rules. Mayers neither admitted nor denied misconduct.
JESSICA L MOORE (WINSTON-SALEM) – By Consent, the Commission suspended the broker license of Moore for a period of 12 months, effective December 15, 2024. The Commission then stayed the suspension in its entirety upon certain conditions. The Commission found that Moore acted as designated buyer-agent for a client. The designated listing agent and firm advertised the subject property and misrepresented the heated square footage (“SF”). Moore pointed out to her buyer-client that she believed the SF was inaccurate but failed to measure herself or discuss the possible inaccuracy with the designated listing agents. Moore completed her firm’s Broker Confirmation Form in which she agreed that she did not observe any gross discrepancies in SF at the time of showing. After the purchase, the buyer discovered that the advertised SF was 25% greater than the actual AF. A private settlement has been reached with the buyer.
PIER 24 REALTY LLC (JACKSONVILLE) – By Consent, the Commission reprimanded Pier 24 Realty effective December 15, 2024. The Commission found that the Firm provided property management services and maintained security deposit and rental trust accounts. The Firm failed to ensure that the trust accounts were labeled as “trust” or “escrow.” The Firm failed to maintain complete property ledgers and records that would provide a complete audit trail.
MILLS A TOWLER (JACKSONVILLE) – By Consent, the Commission suspended the broker license of Towler for a period of 2 years, effective September 16, 2024. The Commission then stayed the suspension following a 3-month active period upon certain conditions. The Commission found that Towler acted as listing agent for a property and received a home inspection report and additional information from the buyer under contract regarding a leaking bathroom drainpipe and damaged subfloor. The contract terminated after the parties could not come to agreement on repairs and Towler failed to update his listing or otherwise disclose these material facts to three subsequent buyers.
