The Texas Real Estate Commission met February 13 and proposed several rule changes, which will be published in the Texas Register for public comment. Visit TREC’s website for all meeting materials.
The Unauthorized Practice of Law and Use of Standard Contract Forms (§537.1 and §537.11)
- TREC received hundreds of public comments opposing an amendment proposed in November that would have eliminated the ability of license holders to use contract forms prepared by an attorney for a brokerage when no commission-approved contract form for mandatory use exists. In response, the commission voted to remove that change prohibiting brokerage forms from its proposal.
- One proposed change adds a definitions section for the term “informational items,” which is intended to better describe the type of information that a license holder can add to a contract form.
- The proposed amendments to §537.11 reorganize and consolidate the rule for clarity and simplify the language regarding when a license holder is required to use a commission-approved contract form and what is considered the unauthorized practice of law.
Broker Responsibility (§535.2) and Obligation to Respond Timely (§535.157)
- The proposed change increases from one to three the minimum number of times that a sales agent who performs a type of real estate brokerage activity must receive coaching or assistance from a competent, experienced license holder.
- The proposed §535.157 requires brokers or sales agents to respond to their principals, brokers or sales agents representing another party to a real estate transaction, or an unrepresented party to a real estate transaction within two calendar days.
Eliminating the “Lookback Period” (§535.91 and others)
- The proposed amendments to §535.91 eliminate the “lookback period” currently found in §535.93, which allows license holders to renew after the expiration date of their license without any lapse in active licensure. Under the proposed rule, a license holder who late renews would automatically renew on inactive status and reactivation would be required.
Requirements for Sales Agent Initial License Renewal (§535.55)
- The proposed amendment to §535.55 requires a sales agent to complete the 30-hour qualifying real estate brokerage course as a part of the additional 90 hours of qualifying courses that must be completed by the expiration date of the sales agent’s initial licensing period. Currently, that course is one of many sales agents may choose to take to satisfy the 90-hour education requirement.
Property Management Course (§535.64)
- Proposed changes to the Property Management course outline strike a portion of the current Commercial Property Management section of the course to reallocate time to other areas of the course outline that need more emphasis.
- A proposed change also renames the course Residential Property Management to emphasize the relevant content of the course.
The earliest that these proposals can be approved is at the next TREC meeting on Tuesday, May 16 in Houston.
This is concerning as a number of companies work 9-5 weekdays. For this change to 535.157 I would like to see it changed to business days versus calendar days.
I wish you would have mentioned Agenda Item 20. The rule change would increase the minimum number of times that a sales agent who performs a type of real estate activity must be coached or assisted by someone experienced in that type of transaction from 1 to 3 times. Basically this means for each type of transaction 3 must receive the coaching or assistance (for example 1-4 property 3 times for sellers and 3 times for buyers) Condo 3 times for buyer and 3 times for seller, etc. This is going to be an administrative nightmare for brokers to manage.
They did mention it
I think it’s needed to many newbies are left on their own. Think about when you first got your license were you ready after one Transaction? I doubt it… I’m totally for this change.
I hadn’t thought of that in this way. So I’d like clarification as well on their needing supervision on their first three or the first three of each type of transaction!
Where can we suggest proposed changes to forms (not necessarily legal terms or conditions)?
I agree with the two calendar days for response. Especially in a competitive environment, time is of the essence. If you are a 9-5 , five day a week business, you may consider designating someone who can be reached to handle business after hours for those who need more immediate assistance.
I’m not in favor of striking a portion of the Property Management course outline removing the current Commercial Property Management section of the course. When we (ESAC) built the course outlines we worked hard to be purposefully all-inclusive, as many licensees are Commercial Practitioners and some Education Providers cater to Commercial.
It’s also important for Residential Practitioners to be aware of exactly when they are crossing into an entirely different Commercial practice.
Please remember the Course Outlines were built to include “Suggested Time Allocations” that TREC can use to administer and approve each course.
Obligation to Respond Timely (§535.157) creates an unnecessary burden on property managers and some commercial brokers, who have a Monday – Friday 9 to 5 business model (closed weekend, holidays and bank holidays). The sales contract already has critical deadlines and penalties for failure to respond.