SB 1968: Texas Written Buyer Agreement Rule

SB 1968 adds two related ideas that are easy to blur together. Section 1101.562 allows a broker to conduct a limited property showing without representing the party. Section 1101.563 requires a written agreement when a license holder performs brokerage for a prospective buyer of residential real property. The written agreement can establish representation or document a limited showing without representation.

Two sections, two different jobs

Section 1101.562 covers a narrow showing without representation. A broker may show real property offered for sale or lease if the broker has not agreed to represent the party, is not otherwise acting as the party's agent, gives no opinions or advice, and performs no other brokerage act for that party. The broker may confirm the property's size, price, and terms.

Section 1101.563 is the written-agreement rule. It applies when a license holder performs brokerage for a prospective buyer of residential real property. The agreement must be in place before the license holder shows residential property or, when no property will be shown, before presenting an offer for that buyer.

What does SB 1968 require?

SB 1968 requires a license holder who performs any act of real estate brokerage for a prospective buyer of residential real property to enter into a written agreement with that buyer before showing residential property, or before presenting an offer to purchase if no residential property will be shown. It took effect January 1, 2026.

The rule sits in the Texas Real Estate License Act and applies to license holders working with buyers. Three pieces define it:

• Who: a prospective buyer of residential real property.
• When: before you show a property, or before you make an offer for the buyer if no showing happens.
• What: a written agreement that spells out the relationship, including whether you represent the buyer.

The point of the law is to put the buyer relationship in writing up front, so the consumer knows whether the agent represents them and how compensation works.

When is the written agreement required?

Before showing residential property to a prospective buyer, or, if no property will be shown, before making an offer to purchase on the buyer's behalf. The trigger is the brokerage activity, not the closing.

The timing is the part candidates miss. The agreement comes first, not at contract signing.

• If you will show the buyer a residential property, the written agreement must be in place before the showing.
• If you will not show a property but will make an offer for the buyer, the agreement must be in place before that offer.

So the written agreement is a gateway to working with the buyer, not paperwork you catch up on later.

It is not automatically a representation agreement

The written agreement SB 1968 requires is not necessarily a buyer-representation agreement. It must state whether the license holder represents the buyer or is only showing property without representation. It can be a representation agreement, but it does not have to be.

A written agreement is required for the residential-buyer situation, but representation is a separate question the agreement has to answer.

• The agreement can establish that you represent the buyer.
• Or it can state that you are only showing a property and do not represent the buyer.

In other words, "a written agreement is required" does not mean "you must represent every buyer." It means the relationship, including the absence of representation, must be in writing. Keep this separate from the IABS notice, which is a disclosure form, not the agreement itself.

What the written agreement must include

Under Section 1101.563(c), the agreement must state the services to be provided, the termination date, whether it is exclusive or non-exclusive, whether the license holder represents the buyer, and the compensation amount or rate and how it is determined, and it must disclose conspicuously that broker compensation is not set by law and is fully negotiable.

Treat these as the terms the written agreement has to cover:

• The services the license holder will provide.
• The termination date of the agreement.
• Whether the agreement is exclusive or non-exclusive.
• Whether the license holder represents the buyer or is only showing property.
• The amount or rate of the license holder's compensation and how it is determined.
• A statement, in conspicuous language, that broker compensation is not set by law and is fully negotiable.

The compensation-is-negotiable language reflects the broader shift toward making fees transparent. For how compensation and fee splitting work more generally, see fee splitting, rebates, and compensation.

The showing-only agreement: non-exclusive and short

If the written agreement is showing-only, with no representation, it may not be exclusive and its term may not be longer than 14 days. That keeps a no-representation arrangement limited rather than locking the buyer in.

The law treats a showing-only deal differently from a representation agreement. When the agreement says you are not representing the buyer:

• It cannot be exclusive.
• Its term cannot run longer than 14 days from the date it is entered.
• If you go on to provide brokerage acts beyond the showing, you must enter a separate written agreement for that work.

The separate-agreement rule keeps a showing-only agreement from quietly expanding into broader brokerage work. Under Section 1101.563(d), once the license holder will provide additional brokerage acts after the showing, the license holder and buyer need a separate written agreement.

The 2026 open-house rule depends on the host

The words "open house" do not decide the answer by themselves. TREC's January 2026 guidance separates two situations:

If the outside host's visitor refuses to enter the required agreement, the host may not show the property. This is why exam questions should be read relationship first: identify whom the host's broker represents, then apply IABS and Section 1101.563 as separate rules.

Subagency references are removed from TRELA

Direct answer: SB 1968 removed two references to subagency from TRELA, effective January 1, 2026. Chapter 1101 no longer mentions subagency at all. Be precise about what that does and does not mean: TREC states that the circumstances in which subagency could arise are now limited, but that subagency has not been eliminated generally as a legal concept. It is gone from the licensing statute, not from the law.

For exam purposes, do not use subagency as the relationship that explains who a Texas license holder represents. The tested relationships are the ones TRELA now names.

For how Texas handles representation of both parties through one broker, review intermediary practice. Intermediary requires written consent and is different from both subagency and common-law dual agency.

How SB 1968 shows up on the exam

Study SB 1968 with the state-law Agency and Brokerage area. Know the written-agreement timing, whether representation exists, the limits on a showing-only agreement, and the removal of the subagency references from TRELA.

You do not need to memorize the bill. You need the handful of facts an exam item can hinge on:

1. A written agreement is required before showing residential property to a buyer, or before an offer if no showing happens.
2. The agreement is not automatically representation. It states whether you represent the buyer.
3. It must cover the services provided, the termination date, exclusivity, representation, compensation and how it is set, and that compensation is negotiable.
4. A showing-only, no-representation agreement is non-exclusive and limited to 14 days, and a separate agreement is required for any brokerage acts after the showing.
5. Subagency references are removed from TRELA.
6. Section 1101.563 is about residential buyers. Section 1101.562 separately permits a limited no-representation showing of property offered for sale or lease.
7. At an open house, identify whether the host's broker represents the owner before deciding whether IABS and a written agreement are required.

For the full state-law structure this fits into, see the Texas real estate exam format, and for the broader 2026 changes, see what changed for the Texas exam in 2026.

Frequently Asked Questions

For quick answers to every common Texas exam question, see the Texas real estate exam FAQ.

When did SB 1968 take effect?

January 1, 2026. From that date, the written-agreement requirement applies to license holders working with prospective buyers of residential real property.

Does SB 1968 mean I have to represent every buyer?

No. It means you need a written agreement before showing residential property or making an offer. The agreement states whether you represent the buyer or are only showing property without representation.

Does the written-agreement rule apply to tenants or commercial property?

Section 1101.563 does not create the same written-agreement requirement for tenants or commercial buyers. Its scope is a prospective buyer of residential real property. Section 1101.562 is broader and permits a limited showing without representation for property offered for sale or lease when all of its conditions are met.

What must the written buyer agreement include?

The services to be provided, the termination date, whether it is exclusive or non-exclusive, whether the license holder represents the buyer, and the compensation amount or rate and how it is determined, plus a conspicuous statement that broker compensation is negotiable and not set by law.

How long can a showing-only agreement last?

If the agreement is showing-only with no representation, it must be non-exclusive and its term cannot exceed 14 days from the date it is entered.

Did SB 1968 change subagency in Texas?

Yes. SB 1968 removed two references to subagency from TRELA, and Chapter 1101 no longer mentions it. TREC is careful to add that subagency has not been eliminated generally as a legal concept, only that the circumstances in which it could arise are limited. Do not turn that change into a broader rule that agency can never arise orally or by conduct.

Sources and Methodology

This article was reverified on July 29, 2026 against the enrolled SB 1968 text, current TREC guidance, and the current IABS form. Section 1101.562 supplies the conditions for a limited showing without representation. Section 1101.563 supplies the residential-buyer written-agreement timing, required terms, separate-agreement rule, and 14-day and nonexclusive limits for a showing-only agreement. The Legislature set the effective date at January 1, 2026. Current TREC material is used to explain how the statute fits with IABS and everyday brokerage practice.

Official Source Links

• Texas Legislature: SB 1968 history and text
• SB 1968 enrolled bill text (Occupations Code Sec. 1101.563)
• SB 1968 bill analysis
• TREC: how SB 1968 changed Texas real estate practice
• TREC: What SB 1968 means for brokers
• TREC: current Information About Brokerage Services form
• TREC: Become a Real Estate Sales Agent

This post is educational content for Texas real estate sales agent candidates. It is not legal advice. Confirm brokerage procedures with the current statute, TREC guidance, and your sponsoring broker before acting for a buyer or conducting a showing.