New Real-Estate Brokers Regulations in Israel require professionalism, transparency, fairness and accountability

On March 9, 2025, the Real Estate Brokers Regulations (Ethics and Professional Duties) of 2024 came into effect which, for the first time, impose rules of ethics and binding professional obligations on all real estate brokers in Israel and regulate key aspects of real estate brokers’ work.

These Regulations aim to ensure professional, fair and transparent brokerage services – by imposing high professional standards on brokers –  as well as tprovide greater protection to buyers and renters, thereby raising Israel’s real estate brokerage practices to a level on a par with global standards.

The key provisions of the Regulations include, inter alia, stricter advertising requirements, mandatory disclosure of comprehensive information about properties, mandatory disclosure of multiple representation, and a prohibition of charging extra fees:

1. Provisions regulating advertisements of properties

The Regulations obligate real estate brokers to act fairly and transparently when advertising properties, and inter alia, to not advertise a property or perform any brokerage action with a property without the consent of the property owner, and to not show any property to potential clients when the broker knows that it is not for sale or rent. Real estate brokers are also obligated to display their details (including their license number) on any of their advertisements and to issue updates about properties that are no longer for sale or rent.

2. Provisions regulating the provision of information to potential customers

In order to ensure due disclosures of properties, real estate brokers are obligated to present the property’s dossier to potential clients during any potential real-estate transaction.

 A.  Real estate brokers are obligated to present material information about the property to potential clients, including:

• official written property documentation identifying the property, ownership details, property size, the number of rooms, whether the property includes balconies, parking spaces or storage rooms and their location, the floor on which the property is located and whether there is an elevator;
• if a tenant other than the owner is occupying the property, the date when the tenant is expected to vacate and when possession will be transferred;
• whether or not the land is available for construction (insofar as at issue, is a transaction for the sale of land rights);
• whether the property has been declared unsafe or uninhabitable;
• the asking price for the property
• in relation to property rentals, information about the additional compulsory payments (and their approximate sums), such as municipal property tax payments, condominium committee fees (participation in the condominium’s management and maintenance expenses), etc.

B. Real estate brokers are obligated to obtain written disclosure forms from property owners and to present the owners’ responses to potential clients, which encompass:

• defects, such as water leaks;
• material defects in the property’s infrastructure, including water, electricity, gas and sewage;
• construction not conforming with the building permit;
• official written information from the local authority’s engineering department if the building has been declared unsafe or uninhabitable;
• any legal proceedings, lawsuits or claims pertaining to the property or rights therein, including criminal proceedings regarding the property’s construction or use thereof;
• professional opinions about material issues concerning the property, apart from appraisals;
• whether there is a need for special possession or use in a particular manner in order to prevent harm to the user or to another person or to the property during ordinary use or maintenance of the property;
• any other defects in the property;
• any noise, odor, radiation or other nuisances that diminish the quality of life in the property.

Furthermore, if real estate brokers provide planning information, they must present the official documentation on which they are relying.

3. Provisions protecting potential clients’ rights vis-à-vis brokers during brokerage transactions, and ensuring due disclosures of transaction details

Real estate brokers are obligated to present themselves as licensed real estate brokers during the first meeting with potential clients and to present their licenses upon clients’ request. During that meeting, real estate brokers are obligated to explain the nature of the brokerage transaction in simple, readily understandable language, including any payment or benefit that the real estate broker is receiving from other parties in relation to the transaction, in order to provide potential clients with full disclosure concerning the real estate brokers’ interests in the transaction.

Furthermore, if a real estate broker is acting for multiple potential clients in any given transaction, the real estate broker must so inform all of the potential clients, obtain written consent from each client separately in this regard, and document in writing the offers made to them.

Moreover, real estate brokers can no longer make their brokerage services contingent upon the purchase of another service from them or from another person, and can no longer impose any other upfront fees beyond the brokerage fee, including reservation fees or commitment fees, or the payment of brokerage fees in respect of contract renewals or exercises of options in contracts.

4. Provisions protecting clients’ privacy

Real estate brokers are obligated to obtain clients’ explicit consent in order to make use of information received from them or from another person in relation to a particular property. Real estate brokers are also obligated to not use the details of any person interested in a particular property for the purpose of offering other properties, unless they disclose that their contact details will be used for this purpose and inform them that they have the right to refuse such use. In any case, property-seekers are entitled at any time to refuse to accept offers about any other real estate transactions.

5. Provisions prohibiting real estate brokers from performing property appraisals

Real estate brokers who are not licensed real estate appraisers are prohibited from engaging in property appraisals (offering property valuations). Real estate brokers are also prohibited from performing dual roles: in other words, even if they are also licensed property appraisers, they are prohibited from issuing appraisals for properties for which they are acting or acted as brokers, and are prohibited from acting as brokers of properties for which they issued appraisals until three years after the appraisal or brokerage activities, respectively.

6. Provisions prohibiting real estate brokers from providing legal services

Real estate brokers are prohibited from drawing up or delivering written agreement proposals or memoranda of understanding in relation a real estate transaction. Real estate brokers are also prohibited from performing dual roles: in other words, even if they are also lawyers, they are prohibited from providing legal services for properties for which they are acting or acted as brokers, and are prohibited from acting as brokers of properties for which they have provided legal services until three years after the provision of legal services or the brokerage activities, respectively.

7. Additional obligations

Brokers are obligated to provide clients with a copy of any document they have signed and must retain copies of all documents pertaining to the brokerage transaction for seven years after the signing dates, thereby ensuring accountability and traceability. 

Queries to the Registrar of Real Estate Brokers about the new regulations

Within the framework of implementing the new rules of ethics, the Registrar of Real Estate Brokers, in collaboration with an advisory committee, are allowing the public to submit queries and complaints about the conduct of licensed real estate brokers during the performance of their professional duties.

Disciplinary proceedings

The Real Estate Brokers Law of 1996 allows the filing of complaints against real estate brokers to the Registrar of Real Estate Brokers at the Ministry of Justice in any instance of violations of any of the obligations imposed by law and regulations. A prosecutor at the Ministry of Justice will examine the complaint and decide whether the filing of a disciplinary complaint against the real estate broker to the Ministry of Justice’s disciplinary committee, is warranted.

If the committee finds that the real estate broker has committed a disciplinary offense, it may take one or more of the following measures against him: warning, reprimand, fine, suspension of license for a defined period (up to three years) or revocation of license. The committee may also adjudge the real estate broker to pay any expenses incurred by the State or the complainant in respect of the disciplinary investigation.

Adv. Shahar Poller Atzil, Partner at the Litigation Department in our firm, is available to assist with any questions related to this matter.