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How New State Rules Affect Real Estate Businesses

By: Hank Lerner, Esq. on in

On Nov. 17, the state Department of Health announced additional rules in an effort to tamp down the rapid increase in COVID-19 cases and hospitalizations. This article reviews those changes only in relation to real estate practice, and I’ll throw in a few helpful reminders of the existing rules as well.

Masks, Masks, Masks
new universal masking order went into effect at 12:01 a.m. today, Nov. 18. Face coverings/masks are to be worn “indoors or in an enclosed space, where another person or persons who are not members of the individual’s household are present in the same space, irrespective of physical distance.” For business purposes, there’s an exclusion for those “working alone and isolated from interaction with other people with little or no expectation of in-person interaction.” For office employees, that would be if they’re in an office (four walls and a door) by themselves or in a cubicle (three walls) if the walls are high enough to block the breathing zone of all people walking by and other workers are not going in and out of the workspace.

That may be a change for many personal/social interactions but is not much of a change as it relates to real estate offices. The prior order required masks “in any indoor location where members of the public are generally permitted” and at work when “working in any space visited by members of the public… or in any room or enclosed area where other people, except for members of the person’s own household or residence, are present when unable to physically distance.” The only real difference here is that you should keep masks on in the office even when you’re six feet or more from coworkers.

So… if you’re at a real estate office, wear a mask. That said, the state is still strongly encouraging all employees to telework whenever possible and we know Realtors® are pros at working from home, so that helps.

Nothing at all should change for showings or other activities at a seller’s property. Agents/clients/inspectors/etc. already should have been wearing masks at all times in properties, so nothing about this is different.

Reasonable Accommodations
One very interesting difference is the new rule for those individuals who say that they have some sort of condition that would prevent them from wearing a mask. While the prior order said that these conditions were simply exceptions, the new order states that “all alternatives to wearing a face covering… should be exhausted” before the exception applies, and requires that businesses and schools must provide “reasonable accommodations” in that pursuit. This might include offering the use of a face shield instead of a mask or providing service options that do not require a customer to enter the business such as curbside pickup or “other innovative solutions.” Businesses may decline service to those not wearing masks – even those who claim a medical condition – so long as they have provided a reasonable accommodation.

PAR has heard any number of stories about clients (and agents, if we’re being honest) who claim an exemption based on a medical condition, but demand access to a seller’s property when that seller is not comfortable with it. This new order makes it clear that a seller/broker would be authorized to deny entry to a property or office if they have offered a reasonable alternative. Aside from allowing a face shield instead of a mask, other “innovative solutions” might include offering a virtual showing (an agent wearing a mask, directed by the client, livestreams a walkthrough) or a 360 video tour. This further cements that sellers are fully authorized to control access to their own property, and that buyers/buyer agents cannot unilaterally decide to not follow the rules.

Testing, Testing…
The biggest change is the addition of a totally new testing and quarantine order. The state previously recommended (but did not require) a 14-day quarantine for those visiting or returning from certain states. As of Nov. 20, however, it is now a requirement that anyone visiting or returning to Pennsylvania from another state either: (a) “produce evidence” of a negative COVID-19 test “collected within 72 hours prior to entering the commonwealth;” or (b) quarantine for 14 days in one location, with face-to-face interactions limited to their travel group or household.

The primary impact on real estate is going to be for those agents who have buyers or short-term renters coming into Pennsylvania from across state lines. Under this order, those clients would either need negative tests from the prior three days or would need to quarantine for 14 days after arrival.

There are several exceptions to this rule, including for those passing through the state on the way to another destination and those who regularly cross borders for work in Pennsylvania or a neighboring state. But before you ask, the answer is “no – these aren’t loopholes.” For example, a short-term rental client isn’t “in transit through the commonwealth to another destination” if he drives from New York to Chicago and spends a week in Pittsburgh. Nor is a buyer from New Jersey “in transit” if he leaves New Jersey, spends six hours touring homes in the Poconos and then returns to New Jersey. That exception is only good for “the amount of time necessary to complete the transit.” Once the traveler stops traveling and starts renting/touring the exception is done. Similarly, a short-term rental isn’t travel “for the purpose of work” just because the renter does a little work during their vacation, nor is an out-of-state buyer traveling for work just because it’s the agent’s work to show houses – it has to be something that’s necessary for the work of the traveler themselves.

Yes, It’s Your Job
The new mask order specifically states that businesses must “require that all people, including their employees, customers… and visitors, wear a face covering and take reasonable steps to enforce the requirement. Businesses must also post signs notifying every one of the masking rules – even just a simple sign like this one. While new to the mask order itself, this is similar to language already included in the general business guidance that would apply to real estate offices and off-site work such as showings, so it’s something you should already have been doing.

What are “reasonable steps to enforce the requirement?” Well… it depends. I couldn’t possibly list all reasonable steps in an article, but I can definitely say that when a buyer says, “I’d rather not wear a mask” it is not reasonable to just say, “OK – let’s just walk into that house without masks on, then!” 

One of the most common complaints we’ve been hearing from sellers and listing agents is about buyers and buyer agents who are caught on video violating the masking rules. If your client won’t follow the rules you should strongly consider keeping them out of the property – and possibly even reconsidering the business relationship. If you’re uncomfortable making that call yourself, try letting the listing agent know of the buyer’s desire to tour the property with no mask. At that point, the seller can certainly refuse entry, which can get everyone to the same point.

There’s not a specific enforcement requirement for the testing order, but it does say that the travelers have to be able to “produce evidence” of a negative test. This suggests that agents should be asking clients from out of state to produce those test results as part of their client conversations. (And no, it’s not a HIPAA violation to do so.) As with the mask rules, you want to take reasonable precautions to ensure that you’ve done your best to comply and that you’re protecting your clients – buyers and sellers – from possible risk as best as you can.

One way to do that is to continue using the PAR Form COVID-HSA. That form already has a question about whether a signer has “been to any domestic location subject to a federal or state travel advisory.” Given the quarantine order, it would be safe to say that any other state should be considered to be under a state travel advisory at the moment, so anyone coming from out of state would answer that with a “yes.” The signer can then explain whether or not they’ve been tested and have results as part of their explanation.

Finally, if you’ve made it this far, just one more plea for common sense and understanding in these difficult personal and professional times. Every transaction can potentially touch dozens of people – sellers, multiple potential buyers, cooperating agents, inspectors, contractors, closing agents… and all of their families. Whatever your personal thoughts or beliefs, remember the words of the preamble to the Realtor® Code of Ethics, that the practice of real estate imposes “grave social responsibility and a patriotic duty to which Realtors® should dedicate themselves” and that “Realtors® can take no safer guide than that which has been handed down through the centuries, embodied in the Golden Rule, “Whatsoever ye would that others should do to you, do ye even so to them.”

New Rules Issued to Slow Spread of COVID-19

Pennsylvania has issued over a dozen new orders and advisories between last week and this week and though none of those orders specifically target real estate, PAR’s legal team outlines how several will impact your daily practice to varying degrees. 

 Read More
Just Do It

Pennsylvania is currently under an “Order of the Secretary of the Pennsylvania Department of Health Requiring Universal Face Coverings.” This rule clearly applies to showings – that’s not really up for discussion. Wear your mask.

 Read More
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Comments (5)

Comments

  • Michael Maerten   November 18, 2020 at 8:49 am

    Thanks for the share and guidance. Given the rise in cases, especially hospitalizations, it would seem prudent that PAR set a standard that traditional open houses stop until we have a better handle on this virus. I’d rather see us self regulate during this and show that we’re taking it seriously vs be dictated to from higher powers.

    Reply to Michael Maerten
    • Hank Lerner, Esq.   November 18, 2020 at 9:58 am

      Thanks for the comment, Michael – you’re not the only one to suggest this. Throughout this ordeal PAR has tried to balance our goal of advising members (strongly) about what the rules are against the risks of touching that third rail of antitrust by appearing to clamp down on business activities that are still legal when done appropriately.

      I’d argue that “traditional open houses” (a stream of random strangers wandering through a property for hours on end with no screening or supervision) probably have stopped – or at least they should have. As noted in several PAR resources, agents need to limit access and enforce mask/social distancing rules, should do some sort of screening, and ideally would collect real contact information in the event it’s necessary to do contact tracing. But if they do those things well, and with the informed consent of the seller, it is still possible to have a thing called an “open house” even if the event really unfolds more like “open showings without a preset appointment if you’re willing in line to get in, wear masks at all times, and limit your time in the house.” It is ultimately up to the broker to decide if they will allow this sort of marketing as a business practice, and if so, then dependent on the agent and seller reaching agreement on how the relevant rules will be implemented effectively.

      Reply to Hank Lerner, Esq.
  • Vincent Range   November 18, 2020 at 9:23 am

    Great info Hank! Thank you!

    Reply to Vincent Range
  • Jon Mendys   November 19, 2020 at 10:26 am

    Question. What if your an Agent in NJ and PA ?? And you are selling and showing homes in NJ and PA right now ??
    I know some agents are licensed in PA, NJ, and DE and are actively doing all 3 at the same time. Now what ?

    Reply to Jon Mendys
  • Betty Shuster-Hanzlik   November 21, 2020 at 6:56 am

    Dear Hank Lerner, esq.

    Thank you for your wisdom and guidance. Well written. Love the closing comments regarding the preamble, patriotism, and the biblical quote.

    Reply to Betty Shuster-Hanzlik

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