Ed 
Section 1101.563 of the Texas Occupations Code now requires a written buyer representation agreement before you show any residential real property to a prospective buyer, or, if no property will be shown, before you present an offer to purchase on their behalf. Effective January 1, 2026, that means the agreement has to be signed before the showing, not after. The Texas buyer representation agreement is no longer optional.
According to TREC and the language of SB 1968, every agreement must include specific compensation terms (not “to be determined“), a termination date, exclusive vs non-exclusive status. No vague language allowed.
Here’s how I handle this at our brokerage: get it signed before showings, not after. The moment a buyer asks “what do you think?” and you answer with anything beyond square footage, you’re representing them. Quick note: this isn’t legal advice, always verify with TREC directly. But lets break down exactly when you need the agreement, what has to be in it, and how to have this conversation without making it weird.
The Legal Requirement Under Section 1101.563
Here’s the actual language that matters. Under Section 1101.563 of the Texas Occupations Code, a license holder must enter into a written agreement with a prospective buyer of residential real property before showing any residential real property to that buyer, or, if no property is shown, before presenting an offer to purchase on the buyer’s behalf.
That’s not ambiguous. Written agreement. Must enter into. Before the showing.
One thing to keep in mind. This requirement is for residential buyers. It does not apply to commercial purchasers, and it does not apply to tenants (residential or commercial). So if you’re working a lease or a commercial deal, the 1101.563 trigger isn’t the rule you’re worried about.
For the broader context on why this law exists, see my breakdown of SB 1968.
What You CAN Do Without a Buyer Representation Agreement
You can still show a property without a full representation agreement, but only if you have a written non-representation, showing-only agreement in place first (more on that below). There’s no version of this where you walk a buyer through a house on a handshake.
Under that showing-only agreement, you can provide access and let them walk through. You can answer basic factual questions anyone could pull off the MLS. What you can’t do is give advice, share opinions, or advocate. That’s the line.
What REQUIRES a Representation Agreement
The moment representation actually begins, you need the buyer representation agreement signed. Representation includes things like:
- Providing advice about a property
- Sharing your opinions about value, condition, or suitability
- Negotiating on behalf of the buyer
- Preparing or submitting offers
- Recommending terms or strategies
- Advocating for the buyer’s interests
In practical terms, get the representation agreement signed before you show. Because lets be honest. How often do you walk a buyer through a house without them asking “what do you think?” at some point? The moment you answer that with anything beyond “it has three bedrooms,” you’re representing them, and the law wants that in writing first.
What Must Be In the Agreement
Texas law and TREC rules specify what a buyer representation agreement must contain. This isn’t optional.
Specific Compensation Disclosure
The agreement has to state the amount or rate of compensation the broker will receive and how that amount will be determined. It also has to disclose, in conspicuous language, that broker compensation is not set by law and is fully negotiable.
So put real terms in there. A number, a percentage, a clear method. Don’t lean on “to be determined” and call it done.
Termination Date
Every agreement needs a termination date. When does this relationship end? For exclusive agreements, this gives buyers a clear exit point.
Exclusive vs Non-Exclusive
The agreement must clearly state whether representation is exclusive or non-exclusive. Exclusive means the buyer works only with you. Non-exclusive means they can work with other agents too.
NAR Rules vs Texas Law: The Key Differences
If you’re a REALTOR and NAR member, you’ve been dealing with written buyer agreement requirements since August 2024 (from the NAR settlement). But Texas law isn’t identical to NAR rules.
Timing
NAR rules require a written agreement before touring a home. Texas law lines up closely. It requires the written agreement before you show any residential property, or before you present an offer if nothing gets shown. So treat them the same. Get the agreement signed before you show property, every time.
Scope
Texas law applies to “residential real property.” NAR rules apply to MLS participants regardless of property type. So for commercial properties, the Texas legal requirement may not apply, but MLS rules still might.
Enforcement
Violating NAR rules can get you in trouble with your association. Violating Texas law can get your license suspended or revoked. That’s a bigger stick.
The Texas law states that failing to use a buyer representation agreement as required is grounds for disciplinary action under Section 1101.652. TREC has the authority to suspend your license for non-compliance.
How to Have This Conversation
Ok, so you need the agreement. But how do you bring it up without making things awkward? Here’s how we train our agents at Neuhaus Realty Group.
Lead With Value, Not Paperwork
Don’t start with “I need you to sign this.” Start with what you’re going to do for them.
“Before we start looking at homes, I want to make sure you understand exactly how I work and what you can expect from me. Let me walk you through how I represent buyers.”
Explain the Why
Buyers hear about the lawsuits. They have questions. Be the agent who explains things clearly.
“Texas law now requires a written agreement before I can provide advice and advocate for you. This actually protects you. It puts in writing exactly what I’ll do and what it costs. No surprises.”
Present Options
You can offer different agreement structures. Exclusive vs non-exclusive. Different compensation arrangements. Different term lengths. Giving buyers options makes them feel in control.
Address Compensation Directly
“Lets talk about how I get paid. Historically, the seller paid the buyer’s agent through the listing. That still happens often, but it’s not guaranteed. Here’s how we’ll handle it…”
Be direct. Buyers respect direct.
Handle Objections Calmly
Some buyers will push back. “Why do I need to sign something before I even see a house?”
Your answer: “Because once we start looking, I’m going to be giving you advice, sharing my expertise, and advocating for your interests. That’s valuable work, and we both deserve clarity about our relationship before I start doing it.”
What Happens If You Don’t Comply
This isn’t theoretical. The consequences are real.
TREC has enforcement authority. If you’re showing properties, providing advice, and negotiating offers without a written buyer representation agreement, you’re violating the law. Period.
SB 1968 amended Section 1101.652 so that failing to enter into the required written agreement with a prospective buyer is now grounds for disciplinary action. That means TREC can suspend or revoke your license, or impose other sanctions, for non-compliance (Source).
Beyond the legal risk, there’s practical risk. If a transaction goes sideways and there’s a dispute about compensation or representation, having no agreement leaves you exposed. The agreement protects you as much as it protects the buyer.
The Non-Representation Alternative
What if a buyer just wants to see a house but isn’t ready to commit to representation? That’s where the non-representation agreement comes in.
Under Section 1101.562, you can show property without representing the buyer if you have a written non-representation agreement. But the limits are strict. 14 days maximum. No advice. No opinions. No negotiation. Just access.
This isn’t a workaround. It’s a specific tool for specific situations. Most of the time, you want representation. Representation is where the value is.
Getting Your Forms Right
Make sure you’re using current forms. TXR (Texas REALTORS) provides buyer representation agreement forms that comply with the new requirements. Your broker should have these in your transaction management system.
The related IABS form has also been updated to reflect these changes. Present the IABS at first substantive dialogue, then move into the buyer representation discussion.
Ed’s Approach
Here’s how I train my agents. The buyer consultation happens before any showing activity. We sit down (or do a video call) and cover:
- What the buyer is looking for and their timeline
- How our process works and what they can expect
- The IABS disclosure and what it means
- The buyer representation agreement and its terms
- How compensation works in the current environment
By the time we’re done, the buyer understands the relationship, the agreement is signed, and we’re ready to start searching. No awkward paperwork in the car before a showing. No surprise conversations at offer time.
That’s how professionals operate.
This is one piece of a much bigger picture. For a complete overview, see my guide to all 2026 Texas real estate law changes.
Questions?
The buyer representation conversation might feel uncomfortable at first. It gets easier. And honestly, the agents who master this conversation are going to dominate the next decade of Texas real estate.
Need help structuring your buyer consultation or understanding the agreement requirements? Reach out to me. I’m happy to share what’s working for our team, even if you’re not one of my agents. Yet.
