New real estate laws for 2018: What agents should expect

by Jason Porterfield

Staying on top of the latest changes to real estate laws and regulations can sometimes be a challenge. For agents, 2018 will bring changes to how they can market themselves and their services.

The biggest rules and regulations changes to hit Houston-area agents were brought about by state Senate bill 2212, a piece of legislation that was crafted in coordination with the Texas Real Estate Commission (TREC), the Texas Association of Realtors (TAR) and other concerned parties. The bill’s ultimate goal is to ensure more transparency and disclosures in sales and purchases by preventing real estate professionals from making false statements or claims. The bill was signed into law by Governor Greg Abbott in June 2017 and went into effect on Sept. 1.

Naming changes

The new law was also designed to benefit consumers by requiring that the name of the broker be included in advertising materials. However, brokers and sales agents will not have to be identified as such in all advertising and marketing materials.

“The Real Estate License Act was amended to make it clear that a licensed broker cannot be restricted in advertising under its licensed name or assumed name as registered with the Texas Real Estate Commission,” says Grant Harpold, Houston Association of Realtors Legal Counsel. “Further, any sort of additional designation like the term ‘broker,’ or reference to the commission or to a license number is not and no longer will be required. A broker’s name must always be a part of any advertising by a sales agent, but now the law and thus the rules should be easier to understand and follow.”

Sondra Petermann-Williams, an agent for RE/MAX The Woodlands and Spring, believes the new rules will have a positive effect on how transactions are conducted throughout the state.

“TREC knows there has been a lot of concerns and misinformation about advertising requirements,” Petermann-Williams says. “These new rules simplify requirements and ensure consumers know whom they are working with. Realtors need to make sure we stay in compliance with the new rules.”

Petermann-Williams works with a graphic designer who creates the marketing materials for her new properties, including email advertisements and brochures. She has informed her graphic designer of the changes in order to avoid any oversight that might result in her violating the law.

“I have to notify the people who are responsible for my advertising of the new rules to keep them abreast of the changes, as well,” she says. “There are many times that an agent will advertise themselves without including a brand, or you might have a team who doesn’t include it. We have to identify who we work for. I can’t just advertise ‘Sandy Petermann-Williams, Realtor.’ Texas law requires that your license hang with a broker, and I need to identify who that is.”

The old rule governing naming and advertising has been separated into two different requirements. Under the Registration and Use of Names rule, the names associated broker, team name, assumed business name and alternate name are all clearly defined. Each name has to be registered with TREC before it can be used in any type of advertising or marketing. Team names have to end with the term “team” or “group,” in order to avoid implying that the team offers brokerage services independently of its broker.

“The Commission recognizes that some license holders on teams will need to change their signage under the new rules,” Christine Anderson, public affairs specialist for TREC, said in a statement. “To help with this expense, the Commission has extended the effective date of the rule until May 15, 2018.”

Violators will be subject to legal penalties administered by TREC, as well as any discipline that stems from Code of Ethics violations from state and local organizations.

“The Texas Association of Realtors oversees the administration of complaints against and discipline of Realtors for alleged Code of Ethics violations,” Harpold says. “They impanel members to hear a complaint and render a decision. The system works very well from my perspective. Remember, it is separate and apart from a complaint one may file with TREC for alleged misconduct by a license holder for rules or License Act violations.”

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