New Jersey currently prohibits rebates or incentives to consumers, as well as referral incentives to non-licensees. Now, the NJ Senate's Commerce Committee proposes allowing just brokers, not real estate salespersons to offer rebates.
I know states vary on policies. I recently saw a reminder on a great Toronto real estate blog that the agent happily gives generous American Express Gift Certificates for client referrals. I know consumer rebates on closed transactions and referral incentives are related, though separate topics. I'd love to hear your thoughts on this. Does your state allow rebates? Referral incentives? Do you think they should be limited to brokers only?
Thanks from the Jersey Shore!
The proposal:
At its December 14, 2009 meeting, the New Jersey Senate Commerce Committee approved A-373/S-139, which permits rebates to be provided to consumers in real estate transactions. After several years of working with the sponsors of this bill, NJAR® secured amendments stating that only brokers can offer rebates to those purchasing property, rather than allowing all real estate licensees to offer rebates to buyers and sellers, as the original version of the bill would have allowed. In addition, the amendments provide greater consumer protections, including mandating that rebates can only be in the form of a credit or check and requiring that rebates be documented in a contract at the beginning of a brokerage relationship in a written or electronic form or in a buyer agency agreement.
Under current state law, New Jersey real estate licensees are not permitted to offer rebates. Before this bill can be sent to Governor Jon Corzine for his consideration, A-373/S-139 must still be considered by the full state Senate. NJAR® will continue to monitor this legislation as it moves forward with the amendments. If you have concerns regarding this legislation, you may contact your local legislators.
Recent article from the Wall Street Journal and Buyer side rebate firms:
http://www.realestatejournal.com/buysell/markettrends/20060406-hagerty.html
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