Real Estate Team Agreement — RPI Form 512

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This form is used by a group of individuals employed by the same broker to form a real estate Team and set out each member’s obligations and fee sharing as DRE-licensed team members.

Your use of RPI Form 512

Real estate teams

Real estate teams allow brokers and salespersons to expand their reach and improve client services and transaction volume. The team members benefit by the synergy brought on by efficiencies and an aggregation of human resources.

A real estate team consists of two or more licensees who work together under the supervision of the licensed broker who employs them. They often assign to one another on the team the responsibility for marketing, administration and clients.

While teams may use many different strategies, they always need to function within the framework of California real estate licensing laws and the supervision requirements imposed on the employing broker by the DRE.

In California, a real estate team is not a separate licensee situation, like a designated officer. Instead, all licensed members of the team are affiliated with and supervised by the same responsible broker.

The broker remains fully responsible for the real estate activities conducted by each team member, including advertising, negotiations and transaction management. The employing broker needs to agree on the team’s operations and establish administrative policies governing how the teams operate, how compensation is distributed and how client relationships are managed.

A broker-associate or salesperson and their employing broker use a Real Estate Team Agreement to form a real estate team, setting out each member’s obligations and fee sharing as DRE-licensed team members. [See RPI Form 512]

Real estate teams and advertising

A team is allowed to market themselves under a team name, but the advertising needs to clearly identify the employing broker. [Calif. Business and Professions Code §10159.6(b)]

The team name used by members employed by a broker may not imply the group operates as an independent entity separate from their employing broker. [Bus & P C §10159.6(c)]

Thus, the team name will include the last name of at least one of the licensees on the team, either a broker-associate or salesperson, in addition to the word:

associates;
group; or
team. [Bus & P C §10159.7(a)(3)(B)]

Advertising materials including a team name are to include the last name and license number of at least one of the licensed team members. [Bus & P C §10159.6(c)]

Further, the employing broker’s name is displayed as prominently as the team name on all advertising materials. For example, the broker’s name needs to appear in the same or larger font size than the team name. [Bus & P C §10159.6(b)]

Advertising material includes:

real estate transaction documents;
business cards;
stationary;
advertising flyers;
television ads;
print ads;
electronic media;
directional signs; and
any other materials soliciting business from members of the public. [Bus & P C §10140.6(b)(3)]

Breaking down the real estate team agreement

A group of broker-associates and salespersons and their employing broker use the Real Estate Team Agreement published by RPI to form a real estate team and set out each member’s obligations and fee sharing as DRE-licensed team members under the employing broker. [See RPI Form 512]

The Real Estate Team Agreement contains:

date of the agreement;
the name of the real estate team [See RPI Form 512 §1];
the employing broker’s name and DRE license number [See RPI Form 512 §1];
the name and DRE license number of each member on the team, percentage of the team’s net income each team member receives, and each team member’s initially assigned tasks and obligations [See RPI Form 512 §1];
team members will:
- comply with all employment policies of the employing broker [See RPI Form 512 §2.1];
- diligently complete assigned tasks and obligations in a timely manner [See RPI Form 512 §2.2];
- maintain confidentiality of client information [See RPI Form 512 §2.3];
- meet at pre-determined times to discuss performance and benchmarks with other team members [See RPI Form 512 §2.4]; and
- abide by any other provisions listed in the blank spaces [See RPI Form 512 §§2.5 and 2.6];
team fee schedule, the sources of team fees shared among team members, to include:
- brokerage fees received as the result of a sale, lease or mortgage transaction;
- referral fees;
- broker price opinions (BPOs);
- consulting;
- staging services;
- property management services;
- photography services; and
- other (listed in blank spaces) [See RPI Form 512 §3.1];
a list of blanks to enter any sources of fees received by individual team members not shared with the team [See RPI Form 512 §3.2];
a priority distribution percentage of fees a team member earns when they are the primary lead to the client who is the source of the team fee [See RPI Form 512 §3.3];
shared team expenses incurred and paid by individual team members include the cost of:
- print/advertising expenses;
- unlicensed assistant/transaction coordinator;
- office/desk space; and
- other (blank) [See RPI Form 512 §4];
termination agreement, which states the agreement continues until terminated by mutual written consent or 30 days after a team member gives a written Notice of Termination [See RPI Form 512 §5];
general provisions, including all disputes arising between team members are resolved as stated in the team members’ employment agreement with the employing broker [See RPI Form 512 §6];
blank for listing other provisions [See RPI Form 512 §7]; and
signatures of the team members and employing broker. [See RPI Form 512]