Pennsylvania Gov. Josh Shapiro has signed a new bill into law designed to protect home sellers and buyers in residential wholesaling transactions.
Senate Bill 1173, which was sponsored by Republican Sens. Pat Stefano and Greg Rothman, requires anyone conducting residential wholesaling in Pennsylvania to obtain a real estate salesperson license under the state’s Real Estate Licensing and Registration Act. Residential wholesaling involves a wholesaler who secures a purchase contract from a seller and then flips the contract to a buyer without the seller’s knowledge or consent. Wholesalers typically seek distressed properties from an owner who wants to sell quickly and is unaware of the home’s market value. The wholesaler enjoys significant profits when flipping the property for a much higher price.
“Residential wholesaling of real estate has become prevalent in recent years, often at the expense of the most vulnerable,” said Rothman. “Enactment of this legislation will ensure that both homeowners and homebuyers are fully informed of their rights and are equipped to make well-educated decisions.”
Shapiro signed the bill into law on July 8, making it Act 52 of 2024. The law goes into effect in six months.
“This legislation brings much needed uniformity to residential wholesaling, which occurs throughout Pennsylvania,” said Bill Lublin, incoming president of the Pennsylvania Association of Realtors. “It will provide protection for consumers by requiring they receive proper disclosures, ensuring transparency throughout the transaction and giving them recourse if they encounter a problem.”
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