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ORLANDO – Chapter 475.01 of the Florida Statutes outlines the definition of broker (as well as broker associate and sales associate) and what activities constitute the practice of real estate, thereby requiring a real estate license.
An easy way to verify the license status of any real estate licensee is to check the license status via the Department of Business and Professional Development (DBPR) website.
But what if you search the name of someone you’ve encountered at an open house or showing of a property and the results show no matching search? Is that person acting illegally because they don’t have a real estate license? Should you file a complaint?
This article addresses another section of Chapter 475 that you should be aware of, 475.011, which covers specific exemptions to requirement of a real estate license when performing certain activities.
475.011 of the Florida Statutes lays out thirteen (13) exemptions, i.e. when the rules and regulations of Chapter 475 do not apply. While this article does not cover all 13 exemptions, it will cover the main ones we hear confusion about on the Florida Realtors® Legal Hotline.
475.011(1) – “An attorney at law within the scope of his or her duties as such.” An example of this would be an attorney for the seller who negotiates the terms of a sales contract for his client. Or an attorney for a tenant who negotiates the terms of the lease for retail space. What does this exemption NOT mean? That the attorney can be paid a commission. While an attorney can receive payment for his or her legal services, i.e. $250 per hour, unless that attorney also holds a real estate license, he or she cannot be paid a commission, i.e. X% of the sales price or Y% of the annual rental amount on the contract negotiated.
475.011(2) – “Any individual, corporation, partnership, trust, joint venture, or other entity which sells, exchanges, or leases its own real property.” A simple example of this exemption is if John Smith owns his own property, he can sell it or rent it on his own without needing a real estate license. This means John can advertise his property for sale or for rent in the newspaper or online and negotiate directly with any potential buyer or tenant and he does not need a real estate license to do it. A carve out to this exemption is if an agent, employee or independent contractor of any of the above types of entities is receiving payment in the form of a commission or other compensation strictly on a transactional basis and is employed to perform sales, exchanges or leases in the ordinary course of an owner’s business of performing those services to the public. So, an example of where this exemption would NOT apply is to the employee of a company who owns real property, who negotiates the sale of that property and is only paid on a transactional basis, i.e. per sale. However, if that same employee was paid a salary, i.e. $2000 per week, without regards to any sales transaction, the exemption would apply.
475.011(11) – “Any person, partnership, corporation, or other legal entity which, for another and for compensation or other valuable consideration, rents or advertises for rent, for transient occupancy, any public lodging establishment licensed under chapter 509.” What does this mean? A real estate license is not required to rent a property if that property is licensed with the DBPR as a public lodging establishment. There are several categories of public lodging establishments, such as hotels, motels, vacation rentals, bed and breakfast inns, all of which are defined under Chapter 509 of the Florida Statutes. To read more about those specific types of exempt properties, see Florida Statute 509.242.
Meredith Caruso is Associate General Counsel for Florida Realtors
Note: Advice deemed accurate on date of publication
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