New Washington Disclosure & Agency Rules

New Washington Disclosure & Agency Rules: What Homebuyers & Sellers Need to Know

Significant changes to Washington’s real estate law went into effect recently — and many buyers and sellers may not realize how much will shift. From required written agreements with buyer-agents to updated seller disclosure requirements, the rules around how brokerage services are provided and disclosed are evolving.

Here’s a breakdown of what’s new, how it impacts you in Washington, and what to watch out for.

1. Why the Change? A Move Toward Transparency and Buyer Protection

Effective January 1 2024, revisions to Senate Bill 5191 and the corresponding regulations under RCW 18.86 significantly updated Washington’s real-estate agency law. Windermere Vashon+2WPI Real Estate+2
Key motivations:

• Ensure buyers understand their relationship with their agent before services begin.

• Make compensation arrangements clear and negotiable.

• Prevent hidden filtering of listings or unfair practices based on commission.
  These changes reflect larger industry shifts (including national changes stemming from the National Association of Realtors settlement) aimed at increasing accountability and transparency. Spokane REALTORS

2. The Buyer Brokerage Services Agreement (Form 41) — What It Is and Why It Matters

One of the most critical parts of the new law is the requirement that a buyer-broker enter into a written services agreement with the buyer before, or as soon as reasonably practical after, the broker begins providing services. Proistatic+1
Here’s what you need to know about Form 41:

• Agency Relationship Defined: The agreement outlines whether the buyer-broker relationship is exclusive (the buyer works only with that firm) or non-exclusive. brettstomps.com

• Compensation Terms Must Be Clear: The document must specify how the broker will be compensated (percentage, flat fee, etc.). A broker cannot receive more than what is agreed upon. Realestateschool.org+1

• Seller’s Offer of Compensation Disclosure: The form includes a section where the “Seller’s Offer” is disclosed and how it relates to the compensation owed to the buyer-broker. Realestateschool.org

• Filtering and Listing Access: Brokers must disclose that they cannot filter out listings solely because the seller’s offered compensation to the buyer-broker is below a certain amount. The buyer must still be shown all relevant listings unless the agreement states otherwise. Realestateschool.org

Why this matters for buyers: Before you’re shown homes or your agent begins serious search activities, you’ll likely be asked to sign this agreement. It protects you by clarifying your agent’s duties, compensation expectations, and how they represent you. If you’re a buyer and you skip this step — you’re missing an important piece of the new law.

What sellers should know: For sellers, this means the buyer may already be under contract with a buyer-broker whose compensation has been pre-negotiated. The seller’s compensation offer needs to be transparent and may affect negotiation dynamics.

3. Updated Seller Disclosure Rules in Washington

While the focus above is on agency and brokerage agreements, don’t forget the seller side. Washington’s law around seller disclosures — including the use of Form 17 – Seller Disclosure Statement — remains critically important. Fennemore
Key points for sellers:

• Sellers must provide a full, completed disclosure statement (Form 17) to buyers in most residential transactions by statute (RCW 64.06.020). Fennemore

• If the seller becomes aware of new information that alters the disclosure, they must amend before closing unless it was known by buyer or buyer’s inspector or is corrected within 3 days of closing. Fennemore

• The disclosure statement is not a warranty of condition. Sellers who make mistakes are only liable if they had actual knowledge of misrepresentations. Fennemore

In short: sellers need to stay up-to-date and responsive. Buyers must review these disclosures as part of their due diligence.

4. What This Means for Buyers & Sellers in Washington Transactions

For Buyers

• Expect to sign Form 41 (or a broker’s equivalent) pretty early — before or right after your broker starts showing homes.

• Review the compensation terms — who’s paying the broker, how much, and is the seller covering it?

• Know that your broker should show you all relevant listings, not just houses where the seller is offering high compensation.

• Read seller disclosures (Form 17) carefully and ask questions.

For Sellers

• Be aware that buyer-agents may be contractually engaged under full service agreements with buyers, which may affect offers and your interests.

• Clarify how your listing agreement addresses buyer-broker compensation — transparency helps avoid misunderstandings.

• Make sure your seller disclosures are complete, accurate, and up-to-date, including any repairs or changes before closing.

5. Practical Tips & Common Pitfalls

• Don’t rush signing Form 41: Make sure you understand the exclusivity, term, compensation, and how it aligns with your goals.

• Check for “tail” provisions: Some agreements include months after termination during which you could still owe compensation if you buy a house you saw during the term.

• Ask about filtered searches: If your broker chooses not to show listings based on compensation, that may be a red flag.

• For sellers, check buyer-broker compensation field on Form 21 or listing: Make sure everything is disclosed and aligns with your expectations.

• Review seller disclosure early: If you’re a seller, deliver your Form 17 early to give buyers time and avoid last-minute rescissions.

Final Thoughts

The updated Washington laws around agency and brokerage disclosure reflect a meaningful shift: more clarity, more buyer protection, and more negotiation around representation and compensation. For buyers and sellers alike, this means greater transparency — but also more paperwork and more expectations of early disclosure.

Whether you’re buying your first home or preparing to sell, it’s wise to work with a real-estate professional who understands these changes and can guide you through them seamlessly.

Thinking about buying or selling in Washington?
Let’s connect. I’ll walk you through what these new rules mean for your situation, ensure your agreements are solid, and help avoid surprises.
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