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The Legal Blog, brought to you by NVAR's Professional Standards department, helps you stay on top of the latest rules and regulations in the industry.

Effective and Ethical Advertising: What Realtors® Need to Know

By:
  • Daniel B. Harris Esq.
  • Stevie Fisher
Nov 5, 2020
IN A COMPETITIVE MARKET, effective advertising can make all the difference. However, not all “effective” advertisements are legal or ethical. Here are questions and hypotheticals to consider when crafting your next marketing campaign.

Q. What is “advertising” and what should I know before advertising identifiable property?


A. In addition to the Code of Ethics, Realtors® advertising in Virginia are also subject to the Virginia Real Estate Board (VREB) advertising regulations. These rules are intended to protect consumers, and they set the minimum disclosures that must appear in advertising. The disclosures vary depending on the type of advertisement.

According to 18VAC135-20-190, ’Advertising’ means all forms of representation, promotion and solicitation disseminated in any manner and by any means of communication to consumers for any purpose related to licensed real estate activity.” The definition is broad. In practice, advertising includes printed materials, billboards, signs, business cards, email and even social media posts.

There are several important rules that apply to all advertisements:

First, all advertising must be under the direct supervision of the principal/supervising broker (18VAC135-20-190). Brokers are free to add additional requirements over and above those set by the regulations.

Licensees may not advertise identifiable property without the express, written consent of the seller/landlord (18VAC135-20-190) and such advertisements should not knowingly contain any material misrepresentations (18VAC135-20-300(9)). Similarly, Article 12 of the Code of Ethics states that “Realtors®  shall be honest and truthful in their real estate communications and shall present a true picture in their advertising, marketing, and other representations.”

Regardless of the medium, VREB regulation 18VAC135-20-190 (and Article 12 of the Code of Ethics) requires all advertising to include the firm’s licensed name. This information must be “clearly and legibly displayed (“reasonable and readily apparent” under the Code of Ethics).

Finally, if a licensee has an ownership interest in the property, they must disclose in the advertisement their status as a real estate licensee (18VAC135-20-190(E)(2)) and, prior to signing any contract, the nature of any interest in the property (Article 4, Code of Ethics).

Q. What disclosures must appear in my electronic advertising?


A. Electronic advertising can take many forms. In short, “Electronic Media Advertising” includes any advertising conducted online and not in print.

Electronic advertisements must include (i) the licensee’s name, (ii) the licensee’s affiliated firm name; and (iii) the city and state in which the licensees’ place of business is located. In addition, the Code of Ethics requires (iv) state(s) of licensure in all electronic advertisements and firm websites.

This information must be “viewable on the main page or no more than one click away from the main page” (18VAC135- 20-190). “Viewable page” means a page that may or may not scroll beyond the borders of the screen and includes the use of framed pages. The content of the electronic advertisement, including the property description and the listing status, must be kept current and consistent (18VAC135-20-190 (C)(3)).

Q. How do these requirements apply to social media?


A. Under Virginia law and the Code of Ethics, the term “website” generally includes social media. Like the VREB regulations, the National Association of Realtors® has adopted a policy whereby the required information and disclosures can be no more than “one click away” from the social media or website post. For example, a social media posting may include a link to a listing or to a Realtor’s® website. If the required information is included on the linked page, the Realtor® may be in compliance.

If the website has an “About” page with this information that can be accessed from any other page on the website, the Realtor® may be in compliance. However, the Code of Ethics still requires that this information be readily apparent. Therefore, one should not have to click to a second page, scroll through several screens, or actively search through small font for the required information.

Some suggested best practices include:

(1) Include the required information in your profile or “About Me” section.

(2) Include the information in the banner or footer of your website so that it is present on every page within the site.

(3) Always review hyperlinks in your postings to ensure that the required information is included on the linked page.

Q. I have two separate pages for Facebook — one for personal use and one for professional use and marketing. Do I have to include all of the required disclosures and information on my personal page?


A. It is a good idea to include the information required under the Code of Ethics and Virginia law on your personal page, or have a link to the required information. You never take off your Realtor®  “hat,” even in your personal life. It is possible that some of your friends on your personal page are also professional contacts and colleagues. If you like or link to real estate-related articles, listings or advertisements on your personal page, it could be interpreted as real estate advertising or solicitations that would require disclosure. Including the required information will reduce the risk of violating the Code of Ethics or Virginia law if you inadvertently post about a real estate related matter.

Q. What disclosures must appear in non-electronic advertising?


A. For all other forms of advertising, the minimum required disclosures vary depending on the medium:

(1) Business Cards: (i) the licensee’s name (ii) firm’s licensed name and (iii) licensee’s phone number or web address.

(2) For-Sale/Lease signs:

a. On the property, (i) the firm name and (2) primary branch office phone number; b. Signs off the property need only contain the firm name. In either event, the information must be clear and legible (VREB) and displayed in a readily apparent manner (Code of Ethics).

(3) All other print advertisements: (i) licensee’s name and (ii) the firm’s licensed name.

As stated above, the broker may require additional content/ disclosures in the advertisement.

Q. What Fair Housing Considerations should I be aware of?


A. Article 12, Standard of Practice (SOP) 3 states that Realtors®  shall not “print, display or circulate any statement or advertisement with respect to selling or renting of a property that indicates any preference, limitations or discrimination based on race, color, religion, sex, handicap, familial status, national origin, sexual orientation, or gender identity.” A similar rule appears in the Virginia Fair Housing Law (§ 36-96.3(A)(3)).

Bottom line: do not express, directly or indirectly, any preference for, or bias against any person based on a protected class.

Q. I’m a member of the “XYZ Team.” Do I still need to include my brokerage information in my advertising, or is stating my team affiliation sufficient?


A. The Code of Ethics (Article 12, SOP 5) is clear – “Realtors®  shall not advertise nor permit any person employed by or affiliated with them to advertise real estate services or listed property in any medium without disclosing the name of that Realtor’s® firm in a reasonable and readily apparent manner…” In short, your team name does not satisfy this requirement.

SOP 12-5 provides a clear supervision requirement and it is important for brokers to be diligent in ensuring all advertising includes the brokerage name. Article 12 falls under “duties to the public,” so it is important that agents and brokers are doing their part to ensure that the best and most accurate information is being shared with the general public.

Q. I’m the listing agent for a property that was previously listed by another company. My client said that they are ok with reusing photos from the previous listing. Is there anything else I need to do?


A. In 2020, NVAR has seen an uptick in complaints (both formal and informal) relating to Realtors® using photos owned by other Realtors®. Article 12, SOP 10 says that Realtors® are prohibited from “presenting content developed by others without either attribution or without permission…” If it was not your client that developed the photos, you need to secure permission from the developer.

Q. Another Realtor® called me to say that my website is in violation of the Code of Ethics because I have not stated where I am licensed to practice real estate. My website clearly states that I serve Arlington County – what am I missing?


A. The Code of Ethics (Article 12, SOP 9) states, “Websites of Realtors®… affiliated with a Realtor® firm shall disclose the firm’s name and that Realtor’s®… state(s) of licensure in a reasonable and readily apparent manner.” A Realtor® stating their service area or where their office is located on their website is not satisfying this requirement. The best practice? Clearly state, “Licensed in: <insert applicable states here>”. This information is important to members of the public when they are seeking to hire a new Realtor®.

Q. My clients are very interested in a property that has had a “coming soon” sign posted in the yard for more than 30 days. The sign was posted by a Realtor®. At what point is this a violation of the Code of Ethics?


A. “Coming soon” is an MLS-defined term and not defined by the Code of Ethics. Therefore, the Code of Ethics does not address the specific number of days a property can be listed as “coming soon.” According to the Bright MLS Rules and Regulations, listings are limited to 21 days in the coming soon status, except for new construction, condo conversions and major renovations for which there is no occupancy (e.g. no active certificate of occupancy).

However, Article 12 says, “Realtors® shall be honest and truthful in their real estate communications and shall present a true picture in their advertising, marketing, and other representations.” In this situation, at what point does “coming soon” fail to present a true picture? Depending on other factors, a hearing panel may determine that this listing agent failed to present a true picture by advertising the property as “coming soon” for an extended period of time in excess of the MLS rules.

As always, members with specific questions are encouraged to contact the NVAR Legal Hotline at NVAR.com/legalhotline.



Daniel B. Harris, Esq. is the NVAR staff attorney.

Stevie Fisher is the NVAR associate director of professional services.



Group(s):
  • Standards and Ethics
Categories:
  • Professionalism & the Code of Ethics
  • Realtor® Professionalism