Brokerage

Connecticut law limits real estate team names

If you’re a Connecticut state team leader and use the word “group” in your team name, you”ll have to change it by the end of the year per a new law passed in the state that imposes new rules on real estate teams.

Under the new law, which goes into effect in January 2022, real estate teams are defined as “a group of at least two licensed real estate brokers or real estate salespersons who are affiliated with the same sponsoring real estate broker and engage in advertising as a group using a team name.” The law also requires teams to register with the state and initially pay $565, followed by a yearly renewal fee of $375.

In a blow to team leader’s pocketbooks, many Connecticut teams will have to rebrand to an accepted name. By January, teams must use the full name of one of their members or the full name of their brokerage. They can use the word team, but can’t use any term that might confuse the consumer into thinking it is a brokerage, such as LLC, company or group.

In 2019, the Florida Real Estate Commission (FREC) imposed similar guidelines on Florida teams; however, they stopped short of making if a law. According to Jarrod Etheridge, an attorney with the Orlando Law Group PL, “The reasoning behind the [Florida] FREC rule is that the [agency] was receiving complaints from the general public who were often being confused or misled as to who, or what they were dealing with during a real estate deal.” He adds, “Group/Team names were often being mistaken [as] the name of the real estate brokerage, and clients were often unable to determine whether they were dealing with an agent, a broker or brokerage. Under Florida law, only a broker is allowed to use a fictitious name. For example, Keller Williams, Coldwell Banker, Tavistock, etc. A sales or broker associate operating under a Florida entity is required to name the entity after themselves. By creating team names including certain words, FREC believes real estate professionals are crossing this line.” 

It’s likely Connecticut is making these changes for the same reason. In fact, according to the National Association of Realtors, some 24 states already have rules about team advertising similar to the Connecticut changes.

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