Texas has specific rules for real estate agents. There’s a process to getting your license and starting out in this rewarding field.
Knowing more about the rules can help you plan to pursue your Texas real estate license.
Who Can Be Certified to Practice Real Estate in Texas?
The Texas Real Estate Commission (TREC) is a state office that sets qualifications for real estate professionals.
TREC handles licensing for two kinds of real estate sales professionals because in Texas, there are two main kinds of licenses for selling real estate.
The first one is a real estate sales agent license.
The second one is a real estate broker license.
Brokers and sales agents are similar but different.
Sometimes people use these terms interchangeably, which is confusing.
How are sales agents and brokers different? Think of the real estate broker as a step up from being a licensed real estate agent.
In Texas, TREC requires real estate professionals to first qualify as agents before they can become eligible to be brokers.
Also, a sales agent must work under a licensed broker.
So in that sense, the broker is the “thought authority”—he or she is the lead professional in a team.
Requirements for Becoming a Texas Real Estate Agent
To become a real estate agent in the state of Texas, you must meet the following qualifications:
- Be a citizen of the U.S. or have a legal right to work
- Be 18 years or older
- Be a resident of Texas
- Meet the board’s ethical standards for “honesty, trustworthiness, and integrity”
In addition, TREC requires these types of training for a real estate sales agent license:
- Principles of Real Estate
- Law of Contracts
- Promulgated Contract Forms
- Real Estate Finance
Real estate agents must complete a total of 180 classroom hours to become licensed.
If you’re interested, ask your real estate training school how long it takes to complete these classroom hours.
Some schools run these programs more quickly than others—but in general, it takes several weeks to log that many classroom hours and then take a licensing exam.
Additional Tips for Texas Real Estate Sales Agents
In addition to qualifying to be a licensed agent, there’s a lot more to the process of getting started in real estate.
Don’t “just do the classroom stuff”—sales agents should also be grounded in the practical aspects of how to work in this field locally.
For anyone who is looking for Texas real estate training to get a state license, it’s also a good idea to invest in some informal real estate research.
Take a look at local Texas real estate markets you’ll be working in and get a feel for what’s typical in a given neighborhood.
That involves looking at schools, property taxes, local ordinances or HOAs, as well as the sizes and styles of homes that are common. You’ll want to become familiar with what buildings are typically made of and what home systems are like.
You can also start to think about profiling your buyers and sellers.
For instance, you may anticipate working with:
- First-time homebuyers
- Flippers or other investors
- Those looking to transition to a second residential property
- Those looking to sell a rental property or personal property
This kind of analytical thinking goes along with what you’ll learn in your real estate school as you work toward a real estate sales agent license.
Finding a Broker
After qualifying to become a Texas real estate sales agent, the professional must find a broker to work under.
In the real estate world, this broker is often called a “sponsor.”
Again, the broker is like the primary authority, and the sales agent works under him or her.
A Fast-Track to Texas Real Estate Broker Work
In some cases, someone who is an attorney may qualify to work as a real estate broker in Texas.
This guide from the Dallas Bar shows that the Texas Occupations Code authorizes lawyers to act as brokers in real estate transactions.
However, that comes with certain concerns.
One concern is that typical client-attorney privilege does not apply.
Also, a lawyer is not typically working in the real estate field full-time, and so competing duties may become an issue.
The bottom line is that just because the law allows this, doesn’t mean that an attorney should be handling real estate deals.
This opportunity for legal professionals has to be assessed on a case-by-case basis.
Becoming a Real Estate Broker in Texas
Real estate brokers will have the ability to sell real estate directly and sponsor and supervise sales agents.
Those who are eligible to become a broker in Texas must:
- Be a US citizen or have a legal right to work
- Be 18 years or older
- Be a resident of Texas or have been licensed as a sales agent or broker in Texas in the last two years
In addition to these requirements, someone who wants to become a Texas real estate broker has to complete 270 classroom hours including:
- 60 hours in Principles of Real Estate
- 30 hours in Law of Agency
- 30 hours in Law of Contracts
- 30 hours in Promulgated Contract Forms
- 30 hours in Real Estate Finance
- 30 hours in Real Estate Brokerage
Applicants have two years after the real estate brokerage course to apply.
In addition, brokers will agree to complete continuing education.
Continuing education topics include:
- Real estate appraisal
- Real estate marketing
- Property management
- Real estate investments
- Residential inspections
In terms of requisite experience, candidates have to have four years of experience as a sales agent or broker.
They’ll also have to do a background check with the Texas Department of Public Safety and take the licensing exam.
After completing all of this, brokers will think about how to set up a brokerage or office.
Experts talk about establishing a professional workflow that is organized and consistent.
Part of this involves looking at practical marketing activities and how to advertise.
Other related work will involve taking on clients and following through with real estate brokerage services for each client.
In addition to mastering the traditional aspects of the real estate broker’s job, there is new technology, which is extremely important in the real estate world.
Key Technology for Texas Real Estate Brokers
Key technology for real estate brokers includes the following:
Smartphone—smartphones are essential for busy real estate professionals.
Whether it’s keeping in touch with clients, taking pictures of properties or property damage, or anything else, a smartphone is the portal to an always-connected network.
Applications—real estate apps can help you to get up-to-the-minute information about properties, neighborhoods, and critical information points for client work or deals.
Cloud services—sharing files and information through the cloud allows real estate agents to keep everyone informed about what’s going on in the field.
Texas Real Estate Markets
Texas real estate brokers will want to stay tuned about what’s happening to state real estate markets.
After all, they’re often involved in crafting more than one deal at once.
Also, they are thought of as the authorities in the real estate field, often directing sales agents or mentoring them through business relationships.
For a Texas real estate broker, it helps to be up to speed on trends and changes within the market.
Talking about a flat trajectory, writers note that the market has been growing a lot more in the past.
The report cites the Texas Residential Construction Cycle Index, which looks at construction activity to predict future housing trends.
Texas real estate brokers can also look at statistics to understand what people are looking for – in this study, writers note that homes priced less than $200,000 are hot right now.
For a data-driven approach, brokers can also stay advised on key metrics.
Internally, metrics like these help provide feedback on real estate investment financial strategy:
- Internal rate of return
- Gross operating income
- Cash on cash return
- Loan to value ratio
- Gross rent multiplier
In addition, other metrics can help show what’s going on in the market. These include:
- Average days on market
- Average commission per sale
- Sold homes per available inventory ratio
- Year-to-year sale price average
- Sale price per square foot
Additional metrics will target the use of social media and other new technologies. For instance, Texas real estate brokers can think about the difference between actual showings and visits when tracking property interest.
Texas Home Inspectors
Along with licensing real estate sales agents and real estate brokers, the Texas Real Estate Commission also licenses home inspectors.
Home inspectors have an important job in the real estate transaction process.
They come in and analyze the property and its systems to see what problems may exist.
The things that a home inspector finds will affect the value of a property.
Part of the important negotiation around any real estate sale involves the condition of buildings and infrastructure.
That makes the home inspector a central player in getting a real estate deal done.
With that in mind, TREC provides licensing and requirements for professional home inspectors.
Three Levels of Home Inspectors
In the state of Texas, TREC licenses three levels of home inspectors.
The first level is an apprentice inspector.
Think of the apprentice inspector as the entry-level professional.
Apprentices have to train under a top-level inspector called a professional real estate inspector.
Another type of real estate inspector is an inspector with an intermediate-level license.
This professional is simply called a real estate inspector.
After getting the real estate inspector license, an individual can apply to obtain a license as a professional real estate inspector.
This is the highest level of real estate inspector under Texas law.
In general, an individual will need to take the apprentice inspector license first, then get an intermediate level license, and then finally get a professional real estate inspector license.
Substitute experience rules apply—find out more on TREC’s website.
Requirements for a Texas Home Inspector License
As with the Texas real estate sales agent and broker, those who want to get a Texas home inspector license need to fall into the same eligibility categories.
They need to be U.S. citizens or have a legal right to work within the state.
They need to be 18 years of age or older, and residents of Texas.
They also need to meet TREC qualifications for honesty, trustworthiness, and integrity as presented on the TREC website.
In addition to these requirements, and the typical background check, individuals who want an inspector’s apprentice license must show proof of financial responsibility.
To get the intermediate-level license, an apprentice has to complete 90 classroom hours of related coursework.
Much of this involves courses in evaluating heating and air conditioning systems, electrical and plumbing systems, roofing, and other infrastructure.
Performing actual real estate inspections under direct supervision is a key part of advancing under TREC licensing rules.
To get the top-level professional real estate inspector license, the individual must complete 130 classroom hours.
The top-level license includes some of the same coursework along with specialized coursework in ethics, standards of practice, report writing, and more.
The state puts a lot of work into regulating home inspectors because they are so vital to real estate work.
Real estate agents, brokers and inspectors work together to satisfy those parts of the process that are so important to both sellers and buyers.
Of course, buyers will often have more direct and practical questions, since they are taking ownership of the property and buildings.
Good home inspections can also help to avoid legal problems after sale.
Home inspectors should be generally conversant about the law as it applies to real estate liability for faulty or malfunctioning systems.
Another thing that inspectors and agents may both go over is seller disclosure forms.
A seller disclosure form is usually pretty thorough.
The form will detail those types of building liabilities discussed above, such as:
- Potential for water damage
- Any foundation or structural issues
- Appliances in working order
- Well-conditioned HVAC systems
- Attic and basement ventilation
- Functional windows and doors
This is not an exhaustive list; many issues come up in a seller’s disclosure form.
Real estate professionals who know what’s on the form and how to answer questions are prepared for these eventualities.
Texas Real Estate Appraiser Licensing
In addition to real estate sales agents, brokers and inspectors, a fourth group of real estate professionals is also licensed and certified by TREC.
As with these other types of professionals, appraisers need to go through a multi-step process to reach top-level certification.
The entry-level certification is an appraiser trainee.
In addition to the eligibility requirements on legal status, age, and Texas residency, trainees have to complete 75 hours of qualifying appraisal education and then find a supervisor who is a certified appraiser.
Later, by completing 225 classroom hours in addition to that original 75 hours, an individual may become a certified general appraiser or a certified residential appraiser.
Another avenue is to take an additional 75 hours from the original trainee coursework to become a licensed residential appraiser.
Hours of experience rules also apply.
Property appraisers are also directly involved in the real estate process.
They evaluate the real value of a property.
As the home inspector works to evaluate and observe home systems, the appraiser is building a value of what the property is worth.
Because all four of these professionals work together, it makes sense for TREC to license and certify all of them.
How It All Ties Together
Understanding how these four types of real estate professionals work together and how they become qualified is part of understanding how real estate deals work in Texas.
You could say that these professionals have a dual mandate.
On the one hand, all four need to work with buyers and sellers directly and know how to handle questions.
On the other hand, they also need a detailed knowledge of the entire process and how to work with the other professionals.
Over time, you learn a lot of this on the job; however, it’s important to have a solid grounding in real estate processes before you start.
A good real estate training school will explain all of this, not just the part that deals with “customer service.”
A good real estate school will go into detail about all of these categories:
- How the real estate process works: through each step until the conclusion
- Why each person’s role is important
- How each type of professional works with buyers and sellers
- How each type of professional works with lenders
- Dos and don’ts for each professional role
- How to advance in a career according to state regulations
When you have this type of training, you have the competitive edge that you need to jump-start your career in real estate.
Again, though, someone who is interested in jumping into real estate in any of these roles should not skip the process of assessing local markets “at street level.”
That means starting with a very general analysis: where things are, how neighborhoods are laid out, what subdivisions look like, etc.
Even a basic sense of location for the following can help:
- Commercial real estate areas
- Theaters or stadiums
- Renewal districts
- Tax incentive districts
- Historic districts
Beyond that, look for indicators on when various home communities were built, and how they were built (e.g., what kinds of building liabilities may apply).
Back to the Regulators: Evaluating Your Real Estate School
If you are interested in real estate training in Texas, it also makes sense to research how TREC works and what it does.
Ask your real estate training school how training prepares you to become licensed or certified under TREC.
Aside from that, look into all of the above. Ask about how the course treats professional roles.
Ask about how the course prepares you for property valuation work, and how you can start tackling the learning curve on presenting a property both on paper and on-site.
All of this can make you a better agent or other real estate professional as you go out and start working with clients.
Remember, real estate is a communal process, and in some ways, it’s all about people!
But it’s also about having a firm grounding in the process, which is a big part of what a school can do for you.
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