By Riki Markowitz
In November 2017, new advertising and business name regulations for real estate license holders were adopted during the 85th legislative session. Advertising, which includes marketing and publicizing your real estate services, is something that most license holders deal with on a daily basis, but surprisingly, some REALTORS have managed to miss the news.
The new rules, which are upheld and explained by the Texas Real Estate Commission (TREC), may require you to order new business cards, update your website or even change your print ads. One of the statutes requires license holders to register a new business name with TREC. There’s less than a month to go before the deadline.
Here’s what you need to know:
Senate Bill 2212 has been in development for two years. It details new rules regarding business name registration and advertising guidelines for brokers and real estate agents. Justin Landon, vice president of government affairs at San Antonio Board of REALTORS (SABoR), says “It’s like a [TREC] housekeeping bill that addresses a lot of little issues that people are facing.”
The first part of the rule, regarding your business name and registration, includes these provisions:
• Alternate names, associated broker, DBAs, and team names must be defined in ads
• Business name must be registered with TREC before it can be used in advertising
• DBAs and team names are registered by the broker; alternate names are registered by individual license holders
• Team name can not be a broker’s DBA; and it must end with “group” or “team”
Here are the rules regarding advertising:
• Name of the license holder or team name must be easily noticeable in all ads
• The broker’s name must be in all ads and must appear no less than half the font size of the largest contact information for the agent, team name or associate broker. (There is leeway regarding social media advertising.)
For social media ads, text messages, emails and other online marketing outreach, the required information can be located on a separate page. The only condition is that the public must be able to easily access the name of the broker or brokerage on another page (via hotlink or URL).
To comply with the new rules, Shawn Rooker, an agent with Realty Austin, added this information on all of his electronic correspondence and social media advertising:
“Texas law requires all license holders to provide the Information About Brokerage Services form to prospective clients.”
He includes a hotlink that takes consumers to a TREC-approved document with the name, license number and contact information for the brokerage, designated broker, licensed agent supervisor and the agent’s name.
By passing new naming rules and advertising guidelines, as well as amending some older rules, TREC is aiming to prevent the public from being “misled or deceived,” according to the Commission’s website. To help minimize confusion, license holders can go to trec.texas.gov to see nearly two-dozen examples of advertisements that can “create the impression that a sales agent operates or is responsible for a brokerage,” which is a violation of the Texas Real Estate Licensing Act (TRELA) code of conduct. And Article 12 of the National Association of REALTORS’ Code of Ethics reads, “REALTORS shall be honest and truthful in their real estate communications and shall present a true picture in their advertising, marketing and other representations.”
Along with passing these rules, another older statute was repealed. License holders were required to put their designation – i.e. “REALTOR,” “agent,” or “broker,” – after their name in all advertising. According to TREC, you can still use these terms in advertisements but it’s no longer a requirement.
TREC’s examples for how license holders can violate the new rules and mislead consumers include using titles like “owner,” “president,” and “CEO” after the agent’s name. Doing this can give the impression that an agent runs a brokerage. And the wording in a website URL or email address can also imply ownership of a brokerage. Creating a team name that contains words like “brokerage,” “company,” and “associates” might suggest that an agent offers independent broker services.
One way the public might assume that you have an ownership stake in a brokerage is if your name also happens to be part of the broker’s name. For example, if you’re Michelle Smith and the brokerage is called Smith Sisters Brokerage, consumers may believe that you’re a broker or operate the business in some way. TREC suggests registering your business under an alternative name (or DBA, doing business as) for marketing and advertising purposes.
These new name registration and advertising rules take effect on May 15. By this date, your alternate name, DBA, or team name, must be registered with TREC in order for you to place ads, whether they’re in print, online, on TV, radio, billboards or on brochures. There are even more ways you can inadvertently violate TREC’s new rules. Sending emails or text messages to the public, handing out business cards and posting properties and business announcements on your Facebook and Instagram pages are also under the advertising umbrella.
Real estate license holders who are most confused about TREC’s new rules are those who don’t do their own marketing, promotions, and advertising – primarily those who work with an agency. But one shouldn’t assume that just because you don’t order your own business cards, write your own ads or post property photos on Pinterest that you’re in the clear. Just getting the font size of your broker’s name off a point or two could put you in violation of the statutes. Fortunately, the deadline is a few weeks off. Don’t wait until you receive a notice of violation in the mail. Go to TREC’s website right now and find out what you need to do. RL