Key Highlights of the May TREC Meeting

The Texas Real Estate Commission (TREC) held its May meeting in Irving, attracting over 300 attendees. While no new rules were adopted, several important topics were discussed. Below are the key highlights. The full agenda and meeting materials are available on TREC’s website.

Broker Succession

Currently, when a designated broker passes away, the licenses of their sales agents, brokers, or business entity brokers become immediately inactive. To address this, the commission proposed a new rule allowing a 14-day grace period for appointing a new sponsoring broker.

This proposed rule, along with others, will be published for public comment in the Texas Register. The full text of the changes can be found in the meeting materials.

Possible Forms Changes

Lori Levy, General Counsel and Vice President of Legal Affairs for Texas REALTORS®, provided an update on the NAR settlement and its impact on members. She highlighted that Texas REALTORS® is eager to collaborate with the Texas Broker Lawyer Committee’s newly formed compensation subcommittee to consider potential changes to TREC’s promulgated forms.

The compensation subcommittee is seeking feedback on the following proposed changes:

1. Remove all references to the multiple listing services in the contract forms.
2. Include a simple statement that any fees to the brokers in the transaction will be paid through separate agreements between the parties and their brokers or between the brokers.
3. Identify the fees to be paid to each broker in a manner similar to the model used in TREC’s Farm and Ranch Contract (TREC 25-15) or the Texas REALTORS® commercial contract form.
4. Remove all references to brokerage fees in the contract forms and publish an addendum for the payment of brokerage fees using the models found in the Farm and Ranch Contract or the Texas REALTORS® commercial contract form.
5. Add a new subparagraph in Paragraph 12A where the seller may agree to pay a specific concession for fees payable to the buyer’s broker.
6. In Paragraph 12A, include in the definition of Buyer’s Expenses a statement like “broker fees Buyer has agreed to pay” and in the definition of Seller’s Expenses a statement like “broker fees Seller has agreed to pay.”

Feedback on these proposed changes is welcomed and can be sent to TREC. The subcommittee will review and consider all input received.