Monday, August 10, 2020

1889 Institute: real estate "agent" licensing is fake protection for home buyers


REAL ESTATE “AGENT” LICENSING: FAKE PROTECTION FOR HOME BUYERS
Specific meaning of “agent” in common law is violated in Oklahoma statutes.

OKLAHOMA CITY, OK (August 5, 2020) – The 1889 Institute has published “Real Estate Agent Licensing in Oklahoma,” another of the Institute’s installments in its Licensing Directory, which looks at specific licensed occupations and recommends whether or not they should remain licensed. Once again, the repeal of a licensing laws is recommended.

“Most buyers of real estate, especially home buyers, will use a licensed mortgage broker, a licensed inspector, a licensed appraiser, obtain title insurance from a licensed insurer, which requires an abstract report from a licensed abstractor, all examined by a licensed attorney,” said Mike Davis, Research Fellow at the 1889 Institute and author of the report. “How many different licenses are needed to ensure it’s safe to buy a house?” asked Davis.


In the 1889 Institute report, Davis asks whether real estate agent licensing in Oklahoma is deceptive for home buyers. He notes that the law displaces “the traditional common law understanding of ‘agency.’ Including its fiduciary duties like loyalty, good faith, condor, and obedience.” This is because real estate agents in Oklahoma are actually brokers, without fiduciary duty to their customers, under the law, but are explicitly allowed by law to use “agent” as a title.

“The law in Oklahoma, which, no doubt, was written and passed at the insistence of the real estate broker industry, seems designed to protect realtors from consumers,” said Davis.

The 1889 Institute has determined two conditions that should be met for an occupation to be licensed: 1) whether the occupation presents a real and probable risk of harm, and 2) whether, if such risk exists, there is no way for markets and common law to mitigate that risk. These conditions are not met in the case of real estate agents.


About the 1889 Institute
The 1889 Institute is an Oklahoma think tank committed to independent, principled state policy fostering limited and responsible government, free enterprise and a robust civil society. The publication, “Real Estate Agent Licensing in Oklahoma” can be found on the nonprofit’s website at https://1889institute.org.

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