AREC Director Column: Does a Separate Workplace Violate License Law?

by Vaughn T. Poe, Executive Director, Alabama Real Estate Commission

There is still some confusion regarding office space. The threshold question to consider is, “can a licensee or team have a separate office/workspace outside of the brokerage that holds their license?” The answer is “yes.” The next question is how to keep that space legal according to license law. A “legal” workspace is one where a licensee can go to do certain aspects of one’s job. For example, utilize computer equipment, work on documents, load listings into the MLS, and send out virtual contracts. These are just some tasks that can be performed at an individual office/workspace.

So, when does an office/workspace begin to violate license law? When it begins to resemble a branch office. According to Alabama license law, a branch office must be licensed with the Commission and must have a qualifying broker licensed at that location.

Specifically, Code of Alabama, 1975 Section 34-27-32(g) states in part, “If the applicant for a company or broker license maintains more than one place of business in the state, he or she shall have a company or branch office license for each separate location or branch office. Every application shall state the location of the company or branch office and the name of its qualifying broker. Each company or branch office shall be under the direction and supervision of a qualifying broker licensed at that address.”

How does one keep their office/workspace from appearing like a branch office? You must avoid doing anything that might be misleading to a consumer. You cannot advertise that location or use the address of the location in any advertising. Most importantly, you cannot meet clients at that location. Any of these actions may mislead a consumer into thinking that the office/workspace is the location of a licensed brokerage or branch office.