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ARIZONA STATE SENATE
Fifty-Sixth Legislature, Second Regular Session
AMENDED
subdivisions; acting in concert
Purpose
Limits, to within a 10-year period, restrictions on acting in concert to unlawfully divide a parcel of land into six or more lots or sell or lease six or more lots by using a series of owners or conveyances.
Background
A subdivision or subdivided land is improved or unimproved land divided or proposed to be divided for the purpose of sale or lease, whether immediate or future, into six or more lots, parcels or fractional interests, including: 1) a stock cooperative; 2) lands divided or proposed to be divided as part of a common promotion plan; and 3) residential condominiums. Leasehold offerings of one year or more are exempt from the classification of subdivision or subdivided lands (A.R.S. § 32-2101).
A county board of supervisors (county BOS) must approve any land divisions of five or fewer lots, parcels or fractional interests, any of which is 10 acres or smaller in size, if the land division meets outlined requirements, including that the applicant must sign an affidavit or similar document under oath acknowledging that the applicant is aware that the county where the land division occurred or the Arizona Department of Real Estate (ADRE) may investigate and enforce the prohibition against acting in concert to unlawfully divide a parcel of land into six or more lots or parcels.
A person or group of persons may not act in concert to attempt to avoid the requirements to divide a parcel of land or sell subdivision lots by using a series of owners or conveyances or by any other method that ultimately results in the division of lands into a subdivision or the sale of subdivided land (A.R.S. §§ 11-831 and 32-2181).
There is no anticipated fiscal impact to the state General Fund associated with this legislation.
Provisions
1. Deems it unlawful for a person or group of persons acting in concert to, within a 10-year period, attempt to avoid subdivision laws by acting in concert to divide a parcel of land into six or more lots or sell or lease six or more lots by using a series of owners or conveyances.
2. Deems it unlawful for a person or group of persons acting in concert to, within a 10-year period, attempt to avoid subdivision laws by acting in concert to divide a parcel of land or sell six or more subdivision lots by using a series of owners or conveyances or by any other method that ultimately results in the division of the lands into a subdivision or the sale of subdivided land.
3. Requires all real estate employment agreements to include, in material terms, an ascertainable amount or rate of broker compensation, rather than the terms of broker compensation.
4. Requires a real estate employment agreement:
a) for a licensee to represent a buyer in a residential real estate transaction; and
b) before the buyer tours any dwelling.
5. Requires a real estate employment agreement to be entered into before the broker writes a purchase offer on the buyer's behalf.
6. Prohibits a broker who represents a buyer in a residential real estate transaction from receiving compensation from any source that exceeds the rate or amount of broker compensation that is specified in the real estate employment agreement for activities for which a license is required.
7. Defines residential real estate as real property that is located in Arizona and that contains a residential dwelling of one to four units.
8. Defines tours any dwelling as a real estate broker or real estate salesperson entering a residential dwelling at the buyer's direction either:
a) with the buyer physically present; or
b) to provide a live, virtual tour to a buyer that is not physically present.
9. Makes technical and conforming changes.
10. Becomes effective on the general effective date.
Amendments Adopted by the Committee of the Whole
1. Requires all real estate employment agreements to include, in material terms, an ascertainable amount or rate of broker compensation, rather than the terms of broker compensation.
2. Requires a real estate employment agreement:
a) for a licensee to represent a buyer in a residential real estate transaction; and
b) before the buyer tours any dwelling.
3. Requires a real estate employment agreement to be entered into before the broker writes a purchase offer on the buyer's behalf.
4. Prohibits a broker who represents a buyer in a residential real estate transaction from receiving compensation from any source that exceeds the rate or amount of broker compensation that is specified in the real estate employment agreement for activities for which a license is required.
5. Defines terms.
6. Makes technical and conforming changes.
House Action Senate Action
LARA 1/29/24 DP 5-4-0-0 FICO 3/4/24 DP 4-3-0
3rd Read 2/14/24 31-27-0-0-2
Prepared by Senate Research
May 8, 2024
RA/SDR/cs