What The HB 230 Bill Is & How It Helps Buyers & Agents

House Bill 230 (HB 230) is a significant legislative development in Alabama’s real estate sector, aimed at enhancing transparency and fairness for both buyers and real estate professionals. Signed into law by Governor Kay Ivey on March 18, 2025, the bill is set to take effect on April 18, 2025.

Key Highlights of HB 230:

• Clarifies Timing of Written Buyer Agreements: The legislation ensures that consumers are not compelled to sign binding contracts merely to view properties. This provision fosters a more transparent process, allowing buyers ample time to consider and negotiate terms without undue pressure.
• Reinforces Alabama’s RECAD Framework: HB 230 strengthens the Real Estate Consumers Agency and Disclosure Act (RECAD), emphasizing early discussions of brokerage services and compensation. This reinforcement aims to protect both consumers and real estate professionals by promoting clear communication from the outset. Alabama Association of REALTORS
• Mandates Written Agreements Before Submitting Offers: The bill requires that a written buyer agreement be in place before any purchase offer is submitted. This measure ensures that both buyers and sellers have a clear understanding of representation terms, promoting consistency and clarity in transactions. Alabama Association of REALTORS
• Addresses Referral Agreements: HB 230 stipulates that referral agreements between real estate licensees must be in writing. This requirement safeguards against referral scams and promotes fair brokerage practices within the industry.
• Supports a More Open Real Estate Process: By implementing these measures, the bill aims to create a more honest, fair, and transparent real estate market across Alabama, benefiting all stakeholders involved.

The passage of HB 230 represents a strategic investment in the future of Alabama’s real estate industry. The Alabama Association of REALTORS® played a pivotal role in supporting this legislation, highlighting the importance of advocacy and investment in initiatives that foster growth and innovation within the sector.

As the implementation date approaches, real estate professionals and consumers alike should familiarize themselves with the new requirements to ensure compliance and to take full advantage of the protections and clarifications offered by HB 230.