Final answer:
Brokerages and the Texas Association of Realtors generally require a written agreement, such as a listing agreement or a buyer's representation agreement, to formally establish a relationship between a broker and a client, detailing responsibilities, scope of work, and compensation.
Step-by-step explanation:
The Texas Association of Realtors (TAR) and brokerages generally require a written agreement to establish a formal professional relationship between the broker and the client. This written agreement is crucial for delineating the responsibilities, the scope of work, and the terms of compensation for the real estate services provided. For example, when working with buyers and sellers of real estate, a document such as a listing agreement or a buyer's representation agreement is typically used.
In the case of seller's representation, the listing agreement spells out details like the listing price, commission structure, and the duration the property will be listed with the brokerage. On the buyer's side, a buyer's representation agreement outlines the broker's obligation to the buyer, the type of property the buyer is interested in, and how the broker will be compensated, often via a share of the commission from the listing side once a transaction is completed.
These agreements not only protect the legal rights and interests of both parties but also ensure compliance with Texas real estate laws and regulations. The exact form and content of these agreements can vary, but they are generally standardized by TAR to promote a clear understanding and consistency within the Texas real estate market.