Hogan's Law Problems in real estate transactions: Is danger looming? - Agency Journal

Before the passage of the Hoge Act, January 2, 1970, the real estate business was unregulated. Virtually anyone could claim to be a real estate agent.

Effective July 20, 1972, the primary purpose of this law was to protect consumers by establishing a number of rules and restrictions, such as having a professional card, maintaining a registry of real estate agencies and powers of attorney, providing financial guarantees and a written power of attorney signed by the client, and issuing a commission bill.

The Hoge Law thus made it possible to regulate the terms and conditions of real estate professionals and real estate sales and purchase transactions, ensuring the professionalization of market actors, which previously had been''often criticized.

In order to meet the development and expectations of the field, the Hoge Law has of course undergone some changes, including the introduction of the ALUR Law on March 26, 2014 and the ELAN Law on November 23, 2018. Among other things, these laws included mandatory training to maintain a professional card or subscribe to professional liability insurance.

But according to the Competition Agency, these changes are considered insufficient.

Authority of monopoly

In its report published on June 7, 'on the competitive situation in the real estate market,'''The Competition Agency is proposing a complete overhaul of the economic model for deals.

The main accusations? Overly high and opaque fees associated with buying and selling real estate, according to households.

The agency recommends that the government consider a reform aimed, on the one hand, at strengthening the economic protection of consumers and, on the other hand, at easing the conditions for real estate activities.

In this context, it proposes to exclude the activity of real estate intermediation from the scope of the Hoge law for the purchase, sale and search of real estate or, in a second, gentler option, to clearly define the services that qualify as real estate intermediation and''the moment when the economic situation in real estate has deteriorated over the past few months and PRC Housing has not brought any interesting offers for private landlords,' added Daniel Dubrak, president of UNIS.