1.1 District of Columbia Real Estate Commission (DCREC)
Key Takeaways
- DCREC, a nine-member body under DLCP, licenses and regulates DC real estate professionals and meets the 2nd Tuesday monthly (recess in August)
- Members are three brokers, two salespersons, two property managers, one DC Bar attorney, and one consumer member — all DC residents
- DCREC may reprimand, fine up to $2,500 per violation, and suspend, revoke, or deny licenses
- The Real Estate Guaranty and Education Fund pays up to $50,000 per single transaction (aggregate) after a claimant obtains a final court judgment
- A Fund payment automatically suspends the licensee until full repayment plus interest at a Mayor-set rate
The DC Real Estate Commission (DCREC) operates under the Department of Licensing and Consumer Protection (DLCP) and is responsible for licensing, regulating, and overseeing real estate professionals in the District of Columbia.
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DCREC Structure and Authority
Commission Members
DCREC consists of nine members appointed by the Mayor:
| Member type | Number | Requirement |
|---|---|---|
| Licensed brokers | 3 | Active DC broker license |
| Licensed salespersons | 2 | Active DC salesperson license |
| Licensed property managers | 2 | Active DC property manager license |
| Licensed attorney | 1 | Active DC Bar member |
| Consumer member | 1 | Not licensed in real estate |
All members must be residents of the District of Columbia throughout their tenure. The Commission convenes the 2nd Tuesday of each month (recess in August), so time-sensitive matters such as hearings and Fund-payment orders are decided on that monthly cadence. Applicants are advised to submit materials 15 business days prior to a meeting.
Who Must Be Licensed
DC law requires a license to perform real estate activity for another and for compensation. Three license types exist, each tied to specific activities:
- Broker — independently lists, sells, leases, or negotiates real estate; supervises salespersons; holds escrow.
- Salesperson — performs brokerage activity only while affiliated with and supervised by a licensed DC broker.
- Property manager — manages real property for others (leasing, rent collection, maintenance) for compensation.
Statutory Exemptions
| Exempt party | Why |
|---|---|
| Property owners | Selling or leasing their own property |
| Attorneys | Acting in the regular course of legal practice |
| Court-appointed fiduciaries | Executors, trustees, receivers acting under court order |
| Certain salaried employees | Managing the employer's own property |
Key DCREC Functions
| Function | Description |
|---|---|
| Licensing | Process applications, approve education providers, issue/renew licenses |
| Education | Set pre-license and CE requirements; approve schools and courses |
| Enforcement | Investigate complaints; audit broker trust/escrow accounts |
| Discipline | Reprimand, fine (up to $2,500 per violation), suspend, revoke, or deny |
| Guaranty Fund | Administer the Real Estate Guaranty and Education Fund |
DC Real Estate License Law
The framework is found in:
- D.C. Code Title 42, Chapter 17 — Real Estate Brokers' Duties (escrow, agency, the Guaranty Fund).
- D.C. Code Title 47, Chapter 28 — Occupations and Professions licensing (including § 47-2853.197 prohibited acts).
- Title 17 DCMR — the DC Municipal Regulations implementing the statutes.
Exam Tip: When a question references "the Commission," it means DCREC; when it references "the Department," it usually means DLCP, the parent agency (formerly DCRA).
Real Estate Guaranty and Education Fund
The DC Real Estate Guaranty and Education Fund compensates consumers who suffer financial loss from a licensee's misconduct and funds educational programs. It is created under D.C. Code § 42-1706, with payment rules in § 42-1707.
Fund Details
| Item | Detail |
|---|---|
| Contribution fee | $60 (included in license fees) |
| Max per single transaction | $50,000 aggregate (all claimants combined) |
| Escalating per-licensee cap | $10k / $20k / $30k / $40k / $50k over license years 1–5 |
| Prerequisite to claim | A final court judgment (or settlement reduced to judgment) |
| License consequence | Automatically suspended when a payment order issues |
Trap: The $50,000 limit applies per transaction across all claimants, not per claimant. If five buyers each hold judgments arising from one fraudulent transaction, they share a single $50,000 ceiling pro rata.
How the Fund Works
- A consumer is harmed by licensee fraud, misrepresentation, or conversion of funds.
- The consumer obtains a final judgment in a court of competent jurisdiction.
- The consumer applies to DCREC for payment from the Fund.
- DCREC reviews and, if eligible, orders payment.
- Upon the order, the licensee's license is automatically suspended.
License Restoration After Fund Payment
| Requirement | Detail |
|---|---|
| Repayment | Full amount paid from the Fund |
| Interest | At an annual rate set by the Mayor |
| Until repaid | License remains suspended |
Accuracy note: DC law ties the restoration interest to a rate established by the Mayor; do not assume a fixed percentage. The point to remember for the exam is that full repayment plus interest is required before the license can be restored.
Educational Use of the Fund
The Commission may expend up to 20% of amounts deposited in the Fund (as of October 1 each year) on educational programs for licensees, applicants, and the public.
DCREC Contact Information
| Resource | Information |
|---|---|
| Website | dlcp.dc.gov/page/real-estate-commission |
| Parent agency | Department of Licensing and Consumer Protection (DLCP) |
| Education Dept. | (202) 442-4320 |
| Online portal | Access DC (accessdc.dc.gov) |
Commission Powers in Practice
DCREC's authority is investigatory and adjudicatory. It may, on its own motion or on a written complaint, open an investigation, subpoena records, and audit a broker's trust/escrow account — a power that makes recordkeeping a frequent exam topic. After notice and an opportunity for a hearing, the Commission may impose a graduated set of sanctions:
| Sanction | When used |
|---|---|
| Reprimand | Minor or first-time violations |
| Fine (up to $2,500/violation) | Technical or repeated violations |
| Suspension | Serious misconduct; pending repayment after a Fund payment |
| Revocation | Fraud, conversion of client funds, repeated violations |
| Denial | Applicant who fails fitness or disclosure requirements |
Exam Tip: Fines are assessed per violation, so a single transaction with several distinct violations can exceed $2,500 in aggregate even though each violation is individually capped.
The Commission also approves pre-license and CE course providers, sets the content outlines PSI must follow, and publishes the Real Estate Legislation and Regulations document that serves as the official study source for the DC law portion of the exam.
How many members serve on the DC Real Estate Commission, and what is the composition?
What is the maximum fine DCREC can impose per violation?
A single fraudulent transaction harms four buyers who each obtain a $20,000 judgment. What is the most the Guaranty Fund will pay on that transaction?
What happens to a licensee's license when the Commission orders a payment from the Guaranty Fund?