TREC proposes a new advertising rule, adopts revisions to existing rule

The Texas Real Estate Commission met on Monday and adopted amendments to existing rules and proposed several more. View the meeting materials packet, which provides more details about all the changes, on TREC’s website. Here’s a breakdown of the adoption and proposals that relate to advertising.

A change to your advertising rules …

You’re no longer required to include the terms broker, agent, or a similar designation or term in your advertisements. This change is effective September 1 as a result of a law passed during this year’s legislative session. This law passed thanks to legislative efforts from the Texas Association of REALTORS®. TREC made an emergency adoption of this rule during the meeting to comply with the law.

You can’t publish an advertisement that implies a sales agent is responsible for the operation of a brokerage or that fails to include the name of the broker for whom the license holder acts, which can be the licensed name, assumed name, or trade name of the broker as authorized by law and registered with TREC.

… and a new advertising rule proposal

TREC proposed repealing and replacing Section 535.154, Advertising, to align with statutory changes adopted by the 85th Legislature and splits the current rule into two separate rules.

Here are some highlights of the proposed rules:

Registration of alternate, team, and assumed business names with TREC. Before using an alternate, team, or assumed name in advertising, the license holder, broker sponsoring a team, or broker using an assumed business name must first register the name with TREC on a TREC-approved form. Registration is not a change from the current rule, but the new rules define and distinguish between these names.

New provisions about team names. The proposed rules define team names and explain how they can be used in advertising. The proposed rules mention the following:

  • A team name may not include any terms that could mislead consumers into thinking the team is offering brokerage services independent of the sponsoring broker. Team names can’t use certain terms, such as realty, brokerage, company, and associates.
  • A team name must end with the word “team” or “group”.
  • An ad needs to include the broker’s name—which is not a change from the current rule—but a team name is not considered a broker’s name.

Social media and texting clarification. Proposed Section 535.155(c) states, “For an advertisement on social media or by text, the information required by this section may be located on a separate page or on the account user profile page of the license holder, if the separate page or account user profile is:

  • readily accessible by a direct link from the social media or text; and
  • readily noticeable on the separate page or in the account user profile.”

The “information required by this section” means the name of the license holder placing the ad and the broker’s name.

Addition to what is considered deceptive or misleading. The proposed rules add that sales agents’ advertisements that use titles such as owner, president, CEO, COO, or other similar titles would be considered a deceptive or misleading ad.

These are just a few items in the proposed new rules. See Agenda Item 26b-c starting on page 315 of the TREC Meeting Materials packet for all proposed changes.

When would new advertising rules go into effect?

The earliest these proposed rules could be adopted is during the next TREC meeting, scheduled for November 13. If adopted, TREC has recommended that the effective date be six months after the rules’ adoption date, so license holders have time to comply.

Share your feedback on proposed rule changes with TREC

You can provide comments about these proposed rule changes for at least 30 days after they are published in the Texas Register by emailing general.counsel@trec.texas.gov. Enter “Texas Real Estate Commission” in the Agency Name field on this page to find TREC rules published in the Texas Register.

Comments made on this blog post will not be read by TREC and do not count as official feedback on proposed rule changes.

But wait … there’s more

TREC covered a lot of topics during its August 7 meeting. Stay tuned for more blog posts in the coming days that will detail additional takeaways from the meeting by signing up to receive Advice for Texas REALTOR® blog emails to get notified when new posts are available.

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8 Responses to TREC proposes a new advertising rule, adopts revisions to existing rule

  1. Rudy cueva says:

    Could I advertise with a sign stating if your interested in selling of buying a house sign , if I have the permission of the property owner can I post it in their yard? Even though their not selling their property.

    Like

  2. Robin Walker says:

    Having a team name end with “Team” or “Group” does not make sense. If the brokerage that they are sponsored through appears on the marketing, that should be enough. Also, the fact that teams are not allowed to use the terms “company” “realty” etc. should suffice. This is getting a bit out of hand.

    Liked by 1 person

    • Aaron D says:

      I agree with your first point. Identifying the brokerage reveals agency. However, disagree with the second statement, particularly the use of “Realty” because TREC has previously ackmowledged the term implies agency whereas “homes” or “properties” do not. The terms “team” and “group” don’t imply agency at all. It is ridiculous.

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  3. Jim Ivy says:

    I think I am more confused now than before reading the article. Is the new rule saying that I can run an ad with my broker’s name and not put my name in the ad? Why would I want to pay for an ad and not put my name on it?

    If my broker is an LLC and I also put my name (XYZ Realty, LLC – My Name, REALTOR®) does that make it look like I am responsible for the company?

    I would appreciate seeming some examples of proper usage and improper usage.

    Like

  4. Aaron D says:

    The terms “group” and “team” do not imply nor convey agency. The term “Realty” does, however, and was previously allowed. When a broker is the only entity allowed to file DBA’s or team names, and the broker is identified in advertising, then it literally points to the brokerage at every point. I can understand requiring “group” or “team” with names like “XYZ Homes Group” because neither “XYZ” or “homes” imply agency, as previously ruled by TREC. Otherwise “XYZ Homes” could be a builder and not participate in agency. Same with “XYZ Properties Group”, for example. A name like “XYZ Homes Realty”, in conjunction with using the Brokers entity in advertising should suffice, though, because the name implies agency and association to a brokerage. TREC is cutting off the hand to spite the foot. These rules disenfranchise agents by limiting their ability to create a competitive advantage in marketing simply because a subset of agents improperly identify themselves as principles. And TREC is compiling the confusion by removing the requirement that agents actually identify themselves for who they are. If TREC is going to give weight to IABS, which discloses the relationship, and require the brokerage be identified in advertisements, then TREC should reconsider its limitation on team names and DBA’s. Those entities already identify brokerage for the reasons stated above.

    Like

  5. Danny Evatt says:

    “You’re no longer required to include the terms broker, agent, or a similar designation or term in your advertisements. This change is effective September 1 as a result of a law passed during this year’s legislative session. This law passed thanks to legislative efforts from the Texas Association of REALTORS®. ”

    Can TREC or TAR explain WHY this rule was needed or changed? Not requiring an advertisement to identify within the ad that a real estate agent or broker either created the ad and/or is advertising for their services, seems terribly misleading to consumers. Though perhaps I am misunderstanding why this was changed or the reason for the change??

    Like

  6. julia mickm says:

    I would also like to see some examples of what is now correct or permissible vs what the prior rule required…

    Liked by 1 person

  7. Wesley Y says:

    Comments made on this blog post will not be read by TREC and do not count as official feedback on proposed rule changes.

    Like

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