License Reciprocity & License Recognition

Quick Takeaways

License Reciprocity occurs when one state chooses to honor the official real estate license of another, lessening the time effort of completing a multi-state transaction
Every state has different license reciprocity rules and regulations, and it is necessary to check the laws before engaging in even a single transaction.
There are three types of real estate license reciprocity: cooperative, physical location, and turf.

Source: Real Estate License Reciprocity & Portability (The Close, Jun. 28, 2023)

Reciprocity in real estate applies to the functionality of real estate licensure from state to state. Many states do accept licensure from other states, especially neighbors. The National Association of REALTORS® has a "Broker and Salesperson License Reciprocity and Portability" from the State Issues Tracker* (National Association of REALTORS®, November 2019) *Requires nar.realtor username/password.

Various organizations, including the U.S. Bureau of Labor Statistics and the National Conference on State Legislators, regularly conduct research on reciprocity law in each of the 50 states. These reports provide current and reliable information on the reciprocity legislation for all to access.

California created a new law aiming to expedite to reciprocity process for veterans and military spouses – Bill AB 107. The law, one of the newest advances in reciprocity law, recognizes the challenges military spouses face in relocation, often having to move quickly and without enough time to receive a new license that they have already acquired in their current state. New Hampshire welcomed license reciprocity, but other states still feel it is far in the future.

See References for more information.

References

NAR Library & Archives has already done the research for you. References (formerly Field Guides) offer links to articles, eBooks, websites, statistics, and more to provide a comprehensive overview of perspectives. EBSCO articles (E) are available only to NAR members and require the member's nar.realtor login.

What Is License Reciprocity?

Everything You Need to Know About Real Estate License Reciprocity (Kaplan Real Estate Education, Mar. 26, 2024)

Here is a scenario of how real estate reciprocity works: You live in Cincinnati, Ohio. Just across the river from your office is Kentucky. You get frequent calls to help people with their listings and to help them find a home in Kentucky. Can you just go across the state line to Kentucky and practice real estate if you’re a licensed agent in Ohio? The answer is yes if you meet the requirements to be a reciprocal agent in Kentucky. So, how does that happen?

Each state has reciprocal agreements with some adjoining and non-adjoining states. For example, Kentucky has a reciprocity agreement with Ohio, but also with Florida.

Surveys on License Reciprocity

Real Estate License Reciprocity and Portability Guide – 2024 Updated – All 50 states! (AgentAdvice, Oct. 14, 2024)

Cooperative: A state with a cooperative real estate portability agreement is simple—it’s cooperative. A real estate agent licensed in another state can come into that state, conduct business, and still get paid for it. The one and only caveat is that in order to do so, they have to co-broker the transaction with another real estate agent who does hold a license in that state.
Physical location: Unlike a cooperative state, a state with a physical location real estate license portability law allows you to represent your client in an out-of-state purchase or sale. The only caveat is that you must do it remotely. You can’t be located in the state in which you want to conduct business during the transaction period.
Turf: While a physical location states only allow you to work with clients remotely, states with real estate reciprocity turf laws will not allow anyone with an outside real estate license to do business in their state whatsoever.

Occupational Licensing Legislation Database (National Conference of State Legislatures, May 22, 2024)

This database tracks the state-by-state requirements, costs, training and other related details of 48 different licensed, certified or registered occupations across all 50 states. It includes all enacted legislation from 2024 to present and is updated annually or as legislation is identified by NCSL staff.

50-State Guide: Real Estate License Reciprocity & Portability (Corofy Real Estate School, 2024)

Some states have full reciprocity, meaning they accept real estate licenses from any state without any additional requirements. For example, Texas and Virginia have full reciprocity, allowing real estate agents from any state to practice without additional hurdles. Other states have partial reciprocity, which involves additional conditions such as education or experience requirements.

Recent Advances

4 New Occupational Licensing Laws Remove Barriers in Illinois (Illinois Policy, Sep. 5, 2024)

Senate Bill 3740 makes it easier for more real estate brokers with out-of-state licenses to practice in Illinois. Previously, out-of-state brokers needed to be licensed in one of the states with a reciprocal agreement with Illinois to be licensed in the state. Those states were Colorado, Connecticut, Florida, Georgia, Indiana, Iowa, Kentucky, Nebraska and Wisconsin. Now, real estate agents from any state that meets certain requirements will qualify for an Illinois license.

State Lawmakers Continue to Push for Removal Of Impediments to Work (Forbes, Jan. 19, 2024)

In addition to Florida, lawmakers and governors in a number of other states are looking to pass universal licensure in 2024. Universal licensing recognition legislation introduced in Nebraska’s unicameral legislature, LB 16, is also poised to move during the 2024 session. “Ease of mobility for workers coming (or returning) to Nebraska would increase significantly through LB16, and it also opens opportunities for those leaving military service with a military occupational specialty,” writes Laura Ebke, senior fellow at the Platte Institute, an Omaha-based think tank.

Policy Brief: 2024 Update to the Survey of Universal Licensing Reforms in the United States (West Virginia University, Jul. 2024)

This update to the first Knee Regulatory Research Center report on universal licensing recognition provides an overview of the changes to universal licensing recognition since the first edition, as well as an expanded update to the dataset. We find that 26 states have passed universal licensing recognition reforms since 2013, with eight new states passing the reform since the last edition of this report, and eight states significantly expanding the reforms over time. In this way, the legislative reform enables workers to have their occupational license recognized in much the same way that a driver’s license is.

Organizations to Contact for More Information

Association of Real Estate License Law Officials (ARELLO)
150 North Wacker Drive, Suite 920
Chicago, Illinois 60606-1682
312-300-4800
http://www.arello.org

Real Estate Educators Association
7739 E. Broadway, #337
Tuscon, Arizona 85710
(520) 609-2380
http://www.reea.org

eBooks & Other Resources

eBooks.realtor.org

The following eBooks and digital audiobooks are available to NAR members:

Real Estate License Exams for Dummies® (eBook)

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