IMPORTANT ANNOUNCEMENT TO ALL AGENTS

Dear Agents,

We would like to clarify a common question regarding the sale of structured products such as fractional ownership or shares in an LLC that grant exclusive usage rights to a property.

While these may appear to be real estate transactions, they are not always considered as such.
When a buyer purchases shares in a company or LLC that owns a property, even if they are granted exclusive usage rights, they are not legally purchasing real estate. Instead, they are acquiring an interest in a business entity.
These transactions can be considered “securities” and may require a different license (such as a broker-dealer license or exemption registered with the SEC), as well as investor disclosures.
You may only sell these with a real estate license if the following conditions are met:
- The buyer is acquiring direct interest in the property itself (e.g., a fractional title/deed interest), not in a company that owns the property.
- The product is marketed strictly for personal use, not as a financial investment.
- The property ownership is not represented by buying shares in a company, even if the purchase is among friends or family using an entity.
Therefore, it is not permitted to sell products based on shares or LLC interests—even if they grant time or exclusive usage—because this does not constitute a traditional real estate transaction.
What is allowed under a real estate license are traditional timeshare models, where buyers acquire a legal right to use the property for a certain period, not a share of a company.