Ed Neuhaus 
If you’ve been in Texas real estate for more than five minutes, you’ve probably heard someone mention SB 1968 by now. Maybe your broker mentioned it in passing. Maybe you saw it in a CE course. Maybe you’re hearing about it for the first time right now because nobody at your brokerage bothered to tell you.
Either way, you need to understand this bill. SB 1968 is the biggest change to Texas real estate practice in over a decade, and it went into effect January 1, 2026. This isn’t a minor form tweak. This fundamentally changes how you interact with buyers.
A quick note: I’m not your broker (yet), and this isn’t legal advice. Always verify with your sponsoring broker and TREC directly before making changes to your practice. That said, if your broker isn’t walking you through this stuff, you might want to ask yourself why.
Lets dig into what SB 1968 actually is, what problems it’s solving, and what it means for your daily practice.
What Is SB 1968?
Senate Bill 1968 was passed by the Texas Legislature in 2024 and took effect on January 1, 2026. It amends several sections of the Texas Real Estate License Act (TRELA), which is the law that governs how real estate agents and brokers operate in Texas.
The bill gives TREC (Texas Real Estate Commission) authority to clarify and modernize rules around agency relationships, licensing requirements, and disciplinary procedures. But the headline changes are all about one thing: making agency relationships crystal clear.
For the full picture of everything changing in 2026, see my complete guide to Texas real estate law changes.
The Problems SB 1968 Is Solving
To understand why this bill exists, you need to understand what was broken. And honestly, a lot was broken.
Consumer Confusion About Representation
For years, buyers would work with an agent assuming that agent represented their interests. Sometimes that was true. Sometimes the agent was actually a subagent of the listing broker, technically representing the seller. Sometimes nobody really knew what was happening.
Consumers didn’t understand the IABS form. They signed it without reading it. Agents presented it as a formality instead of an important disclosure. The result was people making the biggest financial decisions of their lives without understanding who was actually working for them.
Inconsistent Practices
Some agents got buyer representation agreements signed before the first showing. Some never got them signed at all. Some got them signed at offer time, which created awkward conversations about commission right when emotions were running highest.
There was no standard. No clear requirement. Just a patchwork of different practices depending on which brokerage you worked for and how much your broker cared about compliance.
The NAR Settlement Shadow
And then the NAR settlement happened. Suddenly there was national attention on how buyer agents get paid, how compensation is disclosed, and whether consumers understand the relationships involved.
TREC and the Texas Legislature saw which way the wind was blowing. SB 1968 is Texas getting ahead of the curve, putting clear rules in place before federal regulators decided to do it for us.
The Major Changes Under SB 1968
So what actually changed? Here are the big ones.
Written Buyer Representation Agreements Required
Under Section 1101.563, a license holder who performs “any act of real estate brokerage” for a prospective buyer of residential property must enter into a written agreement with that buyer.
This isn’t optional anymore. It’s the law.
But here’s the key: the agreement is required before “substantive action.” What does that mean? You can still unlock a door for a prospective buyer without a signed agreement. But the moment you start providing advice, opinions, or negotiating on their behalf, you need ink on paper.
For a deep dive on what these agreements need to contain and how to present them, see my guide to buyer representation agreements in 2026.
Non-Representation Status Created
This is the interesting addition. Section 1101.562 now allows you to show property to a buyer without representing them, as long as you meet certain requirements.
You still need a written agreement (the non-representation agreement), but this agreement explicitly states that you are NOT representing the buyer. You can only show property. No advice. No opinions. No negotiation. Just opening doors.
The agreement has a maximum 14-day term and must be non-exclusive. It’s not a loophole to avoid buyer agreements. It’s a specific tool for specific situations.
More details in my article on non-representation agreements in Texas.
Subagency References Repealed
Remember that confusion I mentioned about subagency? Gone. SB 1968 repeals all references to subagency in Texas real estate law.
No more wondering if you’re a subagent of the listing broker. No more confusing disclosures. You either represent the buyer, or you don’t. Simple.
I explain the history and practical implications in my piece on why subagency is dead.
Broker Licensing Requirements Increased
This one affects agents planning to become brokers. The experience points required doubled from 360 to 720. Education credit from a bachelor’s degree is now capped at 300 hours. And the Broker Responsibility Course is required for all brokers at every renewal, regardless of whether you sponsor agents.
Complaint Notification to Brokers
Under SB 1968, TREC can now notify sponsoring brokers when a complaint is filed against one of their agents. The specific details remain confidential, but brokers will know something happened.
This is actually a good thing. It means brokers can address problems earlier instead of being blindsided when discipline comes down.
Why TREC Pushed For This
TREC didn’t wake up one morning and decide to make agents’ lives complicated. There’s logic here.
The commission saw the writing on the wall after the NAR settlement. Consumer protection regulators at the federal level were asking hard questions about real estate practices nationwide. The DOJ has been sniffing around the industry for years.
Texas had a choice: wait for federal regulators to impose rules, or get ahead of it with state-level reforms that work for Texas. SB 1968 is Texas choosing to regulate itself before someone else does it for us.
The underlying philosophy is simple: consumers should understand who represents them. Written agreements force that conversation to happen upfront. Clear agency relationships mean fewer complaints and lawsuits. Removing subagency eliminates a category of confusion that never made sense to begin with.
What This Means For Your Daily Practice
Lets get practical. What do you actually need to do differently?
Update Your Buyer Consultation Process
You need to have the representation conversation before you do anything substantive with a buyer. Not at offer time. Not after they fall in love with a house. At the beginning.
This means building the agreement discussion into your initial consultation. Explaining what representation means. Discussing compensation openly. Getting the agreement signed before the first showing where you’re providing any guidance.
Know When to Use Non-Representation
The non-representation agreement isn’t for everyday use. It’s for specific situations. Maybe a buyer just wants to see a house before deciding whether to work with an agent. Maybe you’re covering a showing for another agent and don’t have a relationship with the buyer.
Don’t use it as a way to avoid the representation conversation. That’s not what it’s for, and it’ll get you in trouble.
Update Your Forms
You should be using the January 2026 versions of all TREC and TXR forms. The new IABS form reflects these changes. Old forms are non-compliant.
Explain the New Landscape to Clients
Your buyers and sellers have been hearing about commission lawsuits and industry changes. They have questions. Be the agent who can explain what’s actually happening in plain English.
Ed’s Take: Why This Is Good For Professional Agents
I know change is annoying. I’ve been doing this long enough to remember multiple rounds of form changes, disclosure updates, and regulatory shifts. Every time, agents complain. Every time, we adapt.
But here’s my honest take: SB 1968 is good for agents who were already doing things right.
If you were already having upfront conversations about representation and compensation, nothing really changed. You just have more legal backing for what you were already doing.
If you were avoiding those conversations, relying on ambiguity, hoping things would work out at closing, well, that was always a risk. Now it’s a bigger risk. Adapt or struggle.
The agents who will thrive under these new rules are the ones who see the representation conversation as a feature, not a bug. It’s your chance to differentiate yourself. To demonstrate your value. To build trust before you even unlock the first door.
At Neuhaus Realty Group, we’ve been training on these changes for months. Our agents have scripts, workflows, and confidence. That’s what good broker support looks like.
Questions?
If your broker hasn’t walked you through SB 1968 in detail, that’s a problem. This law affects every buyer transaction you do. You should have been trained on it before January 1.
Have questions about how SB 1968 affects your practice? Reach out to me. I’m happy to help you understand these changes, even if you’re not one of my agents. Yet.
