<PAGE>

                                                                   Exhibit 10.40

                                  AMENDMENT TO
                              EMPLOYMENT AGREEMENT

         SECOND AMENDMENT TO EMPLOYMENT AGREEMENT made as of this 15th day of
December, 1999 (the "Effective Date of the Second Amendment") to the Employment
Agreement dated as of April 29, 1998, as amended by the First Amendment To
Employment Agreement (the "First Amendment") entered into on the 29th day of
July, 1999, by and between ResortQuest International, Inc., ("ResortQuest") a
Delaware corporation formerly known as Vacation Properties International, Inc.
("VPI") and David L. Levine (the "Employee"), which became effective on May 26,
1998, the date of the consummation of the initial public offering of the common
stock of VPI (the "Employment Agreement").

                                   WITNESSETH:

         WHEREAS, ResortQuest, formerly known as VPI, and Employee have
previously entered into the Employment Agreement and the First Amendment To
Employment Agreement; and

         WHEREAS, ResortQuest and Employee desire to amend the Employment
Agreement, as amended by the First Amendment.

         NOW, THEREFORE, the parties hereto agree as follows:

1. The first sentence of paragraph 1(a) of the Employment Agreement is hereby
amended in its entirety to read as follows:

        "ResortQuest hereby employs Employee as President and Chief Executive
        Officer of ResortQuest. As such, Employee shall have responsibilities,
        duties and authority reasonably accorded to and expected of a President
        and Chief Executive Officer of ResortQuest and will report directly to
        the Board of Directors of ResortQuest (the "Board"). Employee hereby
        accepts this employment upon the terms and conditions herein contained
        and, subject to paragraph 1(c) hereof, agrees to devote Employee's full
        working time, attention and efforts to promote and further the business
        of ResortQuest.

2. Subparagraph 2(a) is hereby amended to read as follows:

        "(a) BASE SALARY. The base salary payable to Employee shall be
        $275,000.00 a year, payable on a regular basis in accordance with
        ResortQuest's standard payroll procedures but not less than monthly. The
        effective date of Employee's change in base salary shall be December 15,
        1999."

3. The last paragraph of Paragraph 2 is hereby amended to add the following new
paragraph:

<PAGE>

         "On December 15, 1999 ResortQuest shall grant to Employee options to
         acquire an additional 75,500 shares of ResortQuest common stock at the
         price per share at which such stock closed on the New York Stock
         Exchange on December 15, 1999. Such options shall vest in installments
         of 25,166 on each of the first and second anniversaries of the
         Effective Date of the Second Amendment, and 25,168 shares on December
         15, 2002. Such options shall be exercisable for a term of five (5)
         years from and after the date upon which such options are granted."

4. The initial paragraph of Paragraph 5 of the Employment Agreement is hereby
amended to read as follows:

         "The term of this Agreement shall begin on the Effective Date of the
         Second Amendment and continue until December 15, 2002 (the "initial
         period"), and, unless terminated sooner as herein provided, shall
         continue thereafter on a year-to-year basis on the same terms and
         conditions contained herein in effect as of the time of renewal (such
         initial period and any extensions thereof being referred to herein as
         the "term"). This Employment Agreement, as amended by the First and
         Second Amendments, and Employee's employment may be terminated in any
         one of the following ways:"

5. Subparagraph 12(h) of the Employment Agreement, as amended by the First
Amendment, is hereby amended to read as follows:

         "(h) If Employee's employment by ResortQuest is terminated within one
         (1) year after a Change in Control by Employee for good reason or by
         ResortQuest without good cause, or if Employee voluntarily terminates
         employment with ResortQuest at any time within the one (1) year period
         after a Change in Control, then ResortQuest shall pay or provide
         Employee with the following severance benefits:"

6. Subparagraph 12(j) of the Employment Agreement, as amended by the First
Amendment, shall be amended to read as follows:

         "(j) In the event that Employee elects to terminate employment at the
expiration of the initial term or at the expiration of any applicable renewal
term(s), or in the event Employee elects to terminate pursuant to subparagraph
12(c), or the Employment Agreement, as amended by the First and Second
Amendments, is terminated by ResortQuest for any reason, Employee shall be
entitled to continued family health insurance coverage for the three (3) year
period after the date of termination in the same manner and to the same extent
set forth in subparagraph 12(h)(iii). Following the three (3) year period of
continued health and welfare plan insurance coverage, including without
limitation family medical, family dental, life insurance and disability
coverage, described in this subparagraph 12(j) and under subparagraph
12(h)(iii), Employee shall be entitled to continued participation in all health
or welfare plans which cover Employee (and eligible dependents), including
without limitation family medical, family dental, life

                                       2
<PAGE>

insurance and disability coverage, in effect on the Employee's date of
termination (which shall be the same or substantially equivalent to the health
or welfare plans in which Employee participated on the Effective Date of this
Agreement), for the five (5) year period after the expiration of the three (3)
year period in the same manner and to the same extent set forth in subparagraph
12(h)(iii), provided that the Employee reimburses ResortQuest for the full
premium for such coverage. It being the intent of the parties that Employee
shall be entitled participate in the full eight (8) years health and welfare
plan benefit coverage set forth in this paragraph, any other provisions of the
Employment Agreement notwithstanding, if Employee should leave employment at
ResortQuest for any reason whatsoever.

         In the event that Employee elects to terminate voluntarily without good
reason prior to the expiration of the initial term of the Agreement, or prior to
the expiration of any applicable renewal term, except if Employee elects to
terminate employment under subparagraph 12(c) as set forth above, Employee shall
be entitled to the full eight (8) years of continued health and welfare benefits
provided for in this subparagraph 12(j), provided that Employee reimburses
ResortQuest for the full premium for such coverage."

7. Exhibit A to the Employment agreement is hereby amended to add new
subparagraph (vii) to read as follows:

    "(vii) Employee reporting to anyone other than the Board or Chairman of the
    Board."

8. SEVERABILITY. If any portion of this Second Amendment is held invalid or
inoperative, the other portions of this Amendment shall be deemed valid and
operative and, so far as is reasonable and possible, effect shall be given to
the intent manifested by the portion held invalid or inoperative.

9. ASSIGNMENT; BINDING EFFECT. Employee understands that he has been selected
for employment by ResortQuest on the basis of Employee's qualifications,
experience and skills. Employee, therefore, shall not assign all or any portion
of Employee's performance under this Amendment. Subject to the preceding two (2)
sentences, this Amendment shall be binding upon, inure to the benefit of and be
enforceable by the parties hereto and their respective heirs, legal
representatives, successors and assigns.

10. COMPLETE AGREEMENT. This Second Amendment, together with the Employment
Agreement, as amended by the First Amendment (all as amended hereby), supersedes
any other employment agreements or understandings, written or oral, between
ResortQuest and Employee, and Employee has no oral representations,
understandings or employment agreements with ResortQuest or any of its officers,
directors or representatives covering the same subject matter as the Employment
Agreement and First Amendment to Employment Agreement (as amended hereby).

         This written Second Amendment, together with the Employment Agreement
and First Amendment to Employment Agreement (as amended hereby) is the final,
complete

                                       3
<PAGE>

and exclusive statement and expression of all the terms of the Employment
Agreement, and it cannot be varied, contradicted or supplemented by evidence of
any prior or contemporaneous oral or written agreements. This written Second
Amendment, together with the Employment Agreement and First Amendment to
Employment Agreement (as amended hereby), may not be later modified except by a
written instrument signed by a duly authorized officer of ResortQuest and
Employee, and no term of this Agreement may be waived except by a written
instruments signed by the party waiving the benefit of such term

11. GOVERNING LAW. This Second Amendment shall in all respects be construed
according to the laws of the State of Tennessee.

12. NOTICE. Whenever any notice is required hereunder, it shall be given in
writing addressed as follows:

                  To ResortQuest:   ResortQuest International, Inc.
                                    530 Oak Court Drive
                                    Suite 360
                                    Memphis, TN 38117
                                    Attention: General Counsel

                  To Employee:      To the address specified below Employee's
                                    name at the end of this Amendment.

Notice shall be deemed given and effective three (3) days after the deposit in
the U.S. mail of a writing addressed as above and sent first class mail,
certified, return receipt requested, or when actually received. Either party may
change the address for notice by notifying the other party of such change in
accordance with this Second Amendment.

13. THE EMPLOYMENT AGREEMENT. Except as expressly set forth herein, all other
provisions of the Employment Agreement, as amended by the First Amendment to
Employment Agreement, shall remain in full force and effect.














                                       4
<PAGE>

         IN WITNESS WHEREOF, the parties hereto have executed this Amendment as
of the day and year first written above.

                                     RESORTQUEST INTERNATIONAL, INC.

                                    By: /s/ John K. Lines
                                      -----------------------------------------
                                    Name: John K. Lines
                                    Title: Sr. Vice President,
                                           General Counsel & Secretary


                                     /s/ David Levine
                                     ----------------------------------
                                     Employee: David L. Levine
                                               349 River Oaks Road
                                               Memphis, Tennessee 38120










                                       5