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State to Release Guidance on Real Estate Teams

In the coming weeks, we expect the Massachusetts Board of Registration of Brokers and Salespeople to issue an advisory on real estate teams. As you know, teams are currently undefined in Massachusetts real estate licensing law and do not have any specific regulations around them - like other states have done. This FAQ will be the first guidance we have seen on teams in Massachusetts.

We expect that the guidance to be issued may impact a lot of real estate teams in our marketplace. Specifically, we expect the guidance to include provisions stating that real estate team names shall not be larger than the name of the real estate brokerage on all advertising including, but not limited to, real estate signs, mailers, and social media graphics.

According to members of the Board of Registration of Brokers and Salespeople, the reason for this interpretation for teams -- which does not apply to agent names -- is that a team is not a licensed entity. Individual agents are licensed as a salesperson or a broker, and the public is less likely to confuse an individual with their brokerage. However, according to the Board of Registration of Brokers and Salespersons members, team names are being confused with brokerage names, which can be confusing for consumers.

In addition, as we discussed at the CCIAOR Broker Roundtables earlier this year, the guidance is expected to re-emphasize who brokers can pay. It will reinforce that brokerages cannot pay an unlicensed real estate business entity, so that means team leaders who are not a licensed real estate business entity must be paid directly, and that any payments to team members must be made by the brokerage itself, not by the team leader if not a broker..

We expect this guidance to be issued in the weeks ahead and we wanted to be sure you are aware in advance to make complying with these new interpretations easier. If you have any questions, please feel free to reach out to CCIAOR, and keep your eye on for more information and guidance.

And in case you missed it, be sure to read the guidance the Board of Registration put out last year clarifying how real estate is to be practiced in Massachusetts.