Texas Register

RULE §535.5License Not Required
ISSUE 08/25/2023
ACTION Proposed
Preamble Texas Admin Code Rule

(a)Acting as a principal, a person may purchase, sell, lease, or sublease real estate for profit without being licensed as a broker or sales agent.

(b)A person who owns property jointly may sell and convey title to his or her interest in the property, but to act for compensation or with the expectation of compensation as an agent for the other owner, the person must be licensed unless otherwise exempted by the Act.

(c)A real estate license is not required for an individual employed by a business entity for the purpose of buying, selling, or leasing real property for the entity. An entity is considered to be an owner if it holds record title to the property or has an equitable title or right acquired by contract with the record title holder. An individual employed by a business entity means a person employed and directly compensated by the business entity. An independent contractor is not an employee.

(d)Trade associations or other organizations that provide an electronic listing service for their members, but do not receive compensation when the real estate is sold, are not required to be licensed under the Act.

(e)Auctioneers are not required to be licensed under the Act when auctioning real property for sale. However, a licensed auctioneer may not show the real property, prepare offers, or negotiate contracts unless the auctioneer is also licensed under the Act.

(f)An answering service or clerical or administrative employees identified to callers as such to confirm information concerning the size, price, and terms of property advertised are not required to be licensed under the Act.

(g)A business entity which receives compensation on behalf of a license holder that is earned by the license holder while engaged in real estate brokerage is not required to be licensed by the Commission if the business entity:

  (1)performs no other acts of a broker;


    (A)a limited liability company as defined by §101.001, Business Organizations Code; or

    (B)an S corporation as defined by 26 U.S.C. Section 1361;

  (3)is at least 51 percent owned by the license holder on whose behalf the business entity receives compensation; and

  (4)is registered with the Commission as provided by §535.35 of this chapter (relating to Registration of Certain Business Entities).

The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.

Filed with the Office of the Secretary of State on August 9, 2023


Vanessa E. Burgess

General Counsel

Texas Real Estate Commission

Earliest possible date of adoption: September 24, 2023

For further information, please call: (512) 936-3284

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