How to Position Team Names in Real Estate Advertising
The Bureau of Real Estate (BRE), which will be referred to as the Department of Real Estate (DRE) starting July 1, 2018, is closely examining team names targeting open house signs and social media. However, realtors may be surprised to learn that it is their peers who are contacting department investigators to report improper team name identifications in advertisements.
What to Include in Advertising
Real estate law, in part, is embodied within the Business and Professions (Bus. & Prof.) Code, which forms the basis of most DRE investigations. If a licensee is found violating professional responsibilities or not complying with regulations, disciplinary action may ensue. Bus. & Prof. Code §§ 10159.6 to 10159.7 authorizes the marketing and other activities of “sales teams” that bear the names of two or more salesperson licensees but not brokers. However, all marketing materials must display the responsible broker’s identity “as prominently and conspicuously as the team name,” and ensure the advertising “does not imply the existence of a real estate entity independent of the responsible broker.” Advertisements must include the identity of the brokerage (aka company), agent and broker associate, and salesperson’s license number. This includes all advertisements ranging from Twitter feeds to flyers. Social media is not exempt due to character limitations. Realtors would be wise to confirm that all electronic broadcasts, including Facebook posts and mass emails, contain proper information.
It is not just the content of the advertisement but also the visibility of the information being regulated. The team name cannot be bigger than the brokerage information, which must be “reasonably prominent” in the display. Nicknames are acceptable as long as a surname is included, along with the related license number. Furthermore, the team name must contain the word “team,” “group,” or “associates.” Should the addition of verbiage to a catchy name not sound appealing, a licensee can do business under a fictitious name, known as a DBA, as long as the DBA is properly licensed.
Keep in mind that the commissioner may refuse to issue a license showing a fictitious name if it
- is misleading,
- implies that the business is a corporation or a partnership when it is not,
- includes the name of a salesperson,
- is in violation of any specific provision of the general fictitious name statute, or
- is a name that has been used by any person whose license has been revoked.
Why So Many Restrictions?
The purpose of these restrictions is to prevent a salesperson from misleading the public into believing that they are the direct representative and confirm that the salesperson’s activities occur under the supervision of a broker. Ultimately, the broker may be held accountable for claims made by a principal even if the broker was unaware of what transpired. Although Bus. & Prof. Code § 10164 allows for the appointment of a salesperson licensee to act as the manager and be responsible for the day-to-day activities of that office, the employing broker remains fully responsible for supervising the licensee. All broker associates must register with the DRE, notifying them of where he or she works. This can be done through Form 215 Broker-Associate Affiliation Notice, which can be found by clicking here.
This article is for general information purposes and is not intended to be and should not be taken as legal advice, as each specific situation needs to be evaluated based on its specific facts.