You should consult an attorney regarding the risks involved and how to protect yourself from liability before agreeing to this situation. A person employed by a builder to sell the builder’s homes is exempt from the Real Estate License Act. If he were working exclusively for the builder, he would be exempt from the act and you would not be responsible for his activities. However, while working as a salesperson under you as his sponsoring broker, he is covered by the provisions of the act and you are responsible for his real estate-related activities. This includes possible civil liability for negligent or other inappropriate activities. One risk you face is that the lines of activities, duties, and responsibilities between the two positions can become blurred, especially to a buyer. Things such as car signs, business cards, and client referrals could lead a buyer to believe that your agent was acting as a real estate salesperson while working for the builder. A court or TREC hearing officer might reach the same conclusion and assess liability or responsibility on the broker.One of the agents I sponsor wants to also work part time selling homes for a local home builder. Are there any risks I should be aware of before agreeing to this?
This agent is licensed under you and is requesting to work for a local builder that will not be listing his properties with your brokerage. This agent should decide what he really wants to do, be licensed or be a builder representative.
Another good question, and answer!
Dear Nancy
No harm intended, but all do not do as well as others in RE therefore a part-time position is sometimes needed yet hopefully just for a season.
Best regards,
The Builder Lobby in Texas is one of the largest, and pays State Reps and Senators to NOT regulate the Construction business! Of course, these payments are called ‘Political Contributions’! The Legal Logic behind licensing and regulating Real Estate Brokers and Agents is the same for as it is for doing the same with Homebuilders! Ergo, either the State should license and regulate Homebuilders, or do away with T.R.E.C. Being a Free Marketeer, I”m for eliminating ALL licensing, as it actually is for collecting taxes and Professional BIrth Control! BTW -, I am licensed for over 40 years, and this… Read more »
Good subject…I’ve always been a bit curious as to “what” specifically would be the down-sides or legal jeopardies a broker could expose himself/herself to in agreeing to a Realtor taking on an additional role as Builder Rep/sales person. And the scenario that most often comes to mind is “a Realtor sells a new construction home, something goes wrong with the house based on the client’s interpretation of the builder’s purchase contract, so the buyer lodges a complaint. That complaint, logically speaking, would be against the builder and not the Realtor. Same scenario—but the problem the client has is with the… Read more »
I say no because you the Broker is taking the Liability on him.
So he wants to sell New Homes just let him go .
Let the Builder take the responsibility on him .
I say an emphatic NO! Who is the Agent representing, the Builder or the client? Ok so let’s say the client is just a customer but this has to be disclosed. Suppose the client decides not to by the builder house what incentive does the Agent have to convince them to buy the Builder’s house when the Agent can just sell them another house. Now the Builder is upset… I just think it’s a bad idea. Do one or the other.
I’ve worked for a builder and could not hold a real estate license.
Exactly most if not all builders will require you to place your license as inactive.