Provo law irks Realtors

PROVO — Utah's standard real-estate purchase contracts may be altered after Provo passed an ordinance last week that alarmed Realtors statewide.

Most homes in Utah are sold using standard contracts constantly updated by the Utah Association of Realtors to reflect new issues in the real-estate industry. Provo's City Council passed an ordinance last week intended to give additional protection to buyers by requiring sellers to provide more disclosure about zoning and the legal uses of their property than is required by the state contract.

The ordinance drew the swift attention of legislators and Realtors, however, and the City Council appears ready to repeal it.

"One of my concerns was that this would be unique to Provo," said Utah Senate President John Valentine, R-Orem. "If that happened we could have more than 400 Utah cities saying they wanted to make up their own rules, too. It would just bring chaos into the real-estate market."

Realtors also said the ordinance put too much of the burden on sellers and upset the critical timeline of real-estate deals by requiring sellers to provide the zoning disclosure before buyers and sellers signed an offer sheet. That form, known as the real-estate purchase contract, includes a negotiated period of time for buyers to check what the sellers have presented about the property and zoning.

Provo City Council Chairman George Stewart said he has the votes to repeal the ordinance on Tuesday after Valentine brokered a meeting between council leadership and Chris Kyler, chief executive officer of the Utah Association of Realtors. Provo Mayor Lewis Billings told the City Council in an e-mail Wednesday morning that he would not sign the ordinance into law.

The sides clearly will have to work out a compromise about when sellers would have to make zoning disclosures, either before or after an offer is signed. Kyler said it is virtually impossible to do before an offer and that some of Provo's ordinance turned on its head the standard Utah real-estate presumption of caveat emptor — buyer beware — that puts emphasis on the buyer researching the veracity of seller disclosures and claims.

The Provo ordinance also bothered Valentine because it would provide buyers a way out of a contract that isn't included in the contract.

Stewart said the Provo City Council embraced the idea of putting more responsibility on sellers, but both sides like the idea that improved zoning disclosure requirements in the purchasing process would benefit buyers and sellers around the state.