California Real Estate Practice Exam

When did the Agency Relationship Disclosure Law become effective?

1. 1975

2. 1980

3. 1988

4. 1995

The correct answer is: 1988

The Agency Relationship Disclosure Law became effective in 1988. This law was established to clarify the relationships between real estate agents and their clients, ensuring that buyers and sellers understand the nature of the agency relationships they are entering into. This law also emphasizes the importance of transparency and informed consent in real estate transactions. The introduction of this law marked a significant shift in the real estate industry in California, aiming to protect consumers by requiring agents to disclose their roles and the duties they owe to their clients. Understanding these relationships is crucial for both parties involved in a transaction. Contextually, while there were developments and regulations in the previous years, such as in 1975 and 1980, it was the establishment of the Agency Relationship Disclosure Law in 1988 that specifically addressed agency relationships in real estate transactions. The law reinforces the importance of clear communication and ethical practices in the industry.