1. (a) Acting as a principal, a person may purchase, sell, lease, or sublease real estate for profit without being licensed as a broker or sales agent.
2. (b) A person who owns property jointly may sell and convey title to his or her interest in the property, but to act for compensation or with the expectation of compensation as an agent for the other owner, the person must be licensed unless otherwise exempted by the Act.

3. (c) A real estate license is not required:

   1. (1) for an employee employed by a business entity for the purpose of buying, selling, or leasing real property for the entity; or
   2. (2) as otherwise provided by §1101.005, Occupations Code.

4. (d) For purposes of subsection (c) of this section:

   1. (1) An entity is considered to be an owner if it holds record title to the property or has an equitable title or right acquired by contract with the record title holder.
   2. (2) An employee of a business entity means a person employed and directly compensated by the business entity. An independent contractor is not an employee.
5. (e) Trade associations or other organizations that provide an electronic listing service for their members, but do not receive compensation when the real estate is sold, are not required to be licensed under the Act.
6. (f) Auctioneers are not required to be licensed under the Act when auctioning real property for sale. However, a licensed auctioneer may not show the real property, prepare offers, or negotiate contracts unless the auctioneer is also licensed under the Act.
7. (g) An answering service or clerical or administrative employees identified to callers as such to confirm information concerning the size, price, and terms of property advertised are not required to be licensed under the Act.

8. (h) A business entity which receives compensation on behalf of a license holder that is earned by the license holder while engaged in real estate brokerage is not required to be licensed by the Commission if the business entity:

   1. (1) performs no other acts of a broker;

   2. (2) is:

      1. (A) a limited liability company as defined by §101.001, Business Organizations Code; or
      2. (B) an S corporation as defined by 26 U.S.C. Section 1361;
   3. (3) is at least 51 percent owned by the license holder on whose behalf the business entity receives compensation; and
   4. (4) is registered with the Commission as provided by §535.35 of this chapter (relating to Registration of Certain Business Entities).

Source Note:The provisions of this §535.5 adopted to be effective January 1, 2011, 35 TexReg 11674; amended to be effective January 1, 2015, 39 TexReg 9669; amended to be effective December 7, 2016, 41 TexReg 9520; amended to be effective May 24, 2017, 42 TexReg 2723; amended to be effective June 11, 2023, 48 TexReg 2948; amended to be effective January 1, 2024, 48 TexReg 6912; amended to be effective November 26, 2025, 50 TexReg 7569.