Hey landlords/owners of Las Vegas or Henderson, NV properties...Are you asking agents to list your home for rent as a "courtesy?" Many agents in Nevada have "courtesy rental listing agreements" or "tenant placement agreements." These agreements allow agents to list properties for landlords, who want to owner manage their properties, into the local MLS. Well, you might want to actually consider hiring a property manager. Why? Because, AB161 passed and as of July 1, 2017, these type of listings are going to be harder for agents and landlords to partake in.
The revisions to AB161 came about this last legislative session to help law enforcement with Las Vegas' squatter issue. I sat on the Legislative Management Team for the Nevada Association of Realtors and that was a phenomenal experience. I remember when this bill came to the table. Let me begin by stating that the intended purpose really helps our community and law enforcement deal with the squatter issue. However, there's a few things that were missed that could've really helped to "close the loop" or "add some teeth" to this bill. How? Let's dig in...
AB161 deals with valid rental agreements. The updates to AB161 in this legislative session, Section 1.3 and 1.7 now require notarization of all rental agreements to be valid unless the agreement is notarized or is signed by an authorized agent of the landlord who at the time of signing holds a permit to engage in property management and contains certain contact information for the landlord or the landlord's representative.
The bill goes on to further read that the rental agreement "must contain a disclosure at the top of the first page of the agreement, in a font size at least two times larger than any other font size in the agreement, which states that:
(a) There are rebuttable presumptions in NRS 205.0813 and 205.0817 that the tenant does not have lawful occupancy of the dwelling unless the agreement:
(1) Is notarized or is signed by an authorized agent of the landlord who at the time of signing holds a permit to engage in property management pursuant to chapter 645 of NRS; and
(2) Includes the current address and telephone number of the landlord or his or her authorized representative; and..."
What does that mean? If you're not a property manager, notarize it.
Who notarizes the document? Well, here's the fun part...the bill is silent on that part. It's not clear on whether the landlord has to sign or the tenant has to sign or both. Now, I would venture to guess that it's both...that would be the best practice. However, our current GLVAR agreements don't have any disclosure language nor do they have a place for notarization by anyone.
Ok, so back to AB161...and here's the interesting part...it continues as follows:
"(b) The agreement is valid and enforceable against the landlord and the tenant regardless of whether the agreement:
(1) Is notarized or is signed by an authorized agent of the landlord who at the time of signing holds a permit to engage in property management pursuant to chapter 645 of NRS; or
(2) Includes the current address and telephone number of the landlord or his or her authorized representative."
Who's confused? Let's review:
Does it have to be notarized? According to AB161, THE RENTAL AGREEMENT HAS TO BE NOTARIZED IF YOU ARE NOT AN AUTHORIZED AGENT FOR THE LANDLORD WHO HOLDS A PROPERTY MANAGEMENT PERMIT!
When is the exemption triggered? ACCORDING TO AB161, ONLY IF THE PROPERTY MANAGER SIGNS THE RENTAL AGREEMENT AS THE AUTHORIZED AGENT.
What if the landlord/owner signs? IT APPEARS THAT AB161 APPLIES INCLUDING THE NOTARIZATION AND DISCLOSURE REQUIREMENT
Who has to notarize? AB161 IS SILENT ON THIS BUT A REASONABLE PERSON WOULD GUESS THAT BOTH LANDLORD AND TENANT SHOULD NOTARIZE...BUT DON'T TAKE MY WORD FOR IT, CONSULT AN ATTORNEY!
What if the landlord and tenant sign a rental agreement without notarization or disclosure...will that invalidate the agreement? ACCORDING TO AB161 SECTION 4b, "the agreement is valid and enforceable against the landlord and the tenant regardless..."
Can GLVAR members still take courtesy or tenant placement listings? YOU SHOULD CONSULT WITH YOUR BROKER
Can GLVAR members use the GLVAR lease agreement if they aren't a property manager? GLVAR LEASE AGREEMENT APPEARS TO BE CREATED FOR USE BY REALTORS AND NOT NECESSARILY FOR OWNER MANAGERS...AGAIN, CONSULT YOUR BROKER AND ATTORNEY!
Is the rental agreement invalid if the property is owner managed and not notarized and doesn't have the disclosure on page one? NOT ACCORDING TO AB161 SECTION 4b. THE AGREEMENT IS STILL VALID AND ENFORCEABLE.
So, where can a landlord get a valid lease agreement that would satisfy the requirements of AB161? IF AN OWNER WANTS TO MANAGE THEIR OWN PROPERTY, THEY SHOULD SPEAK TO AN ATTORNEY TO DETERMINE WHAT TYPE OF LEASE AGREEMENT THEY NEED.
Where can you find AB161? Right here.
Check out the article and FAQ by NVAR General Counsel Tiffany Banks by clicking here.
DISCLAIMER: The opinions presented on this blog are my own. This is not intended to be legal advice. I am not an attorney, nor do I play one on TV. Individuals should seek out professional advice.
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