Misleading Real Estate Advertising

It has recently come to light that some members may be advertising unlawful selling features of listed properties. This includes advertising which references construction and property uses that may not be in accordance with local government’s rules. REALTORS® are obliged under section 41 of the Real Estate Services Rules not to publish advertising that includes statements they know or reasonably ought to know are false or misleading.

One example of misleading advertising would be to describe a shed as “convertible to a rental unit”, in a case where such use is not permitted under the applicable municipal by-laws, especially if building permits were not issued for this construction. In this example, what may be intended as a selling feature, may in fact pose serious risks to a potential buyer.

Members are obligated to make informed, fact-based statements when advertising listings to ensure individuals are not misled. When enforcement action is taken by a local government regarding unlawful construction or property use, buyers who have not been properly informed by their Realtor, bear the consequences. Enforcement action may include ensuring the necessary approvals are obtained, or removal of non-compliant construction at the owner’s expense.

In order to protect your clients, members must have a fully informed understanding of the relevant rules regarding construction and use of properties. Zoning by-laws, for example, can restrict and regulate the number and type of dwelling units permitted in any given jurisdiction. Building by-laws, as another example, can require building permits to be obtained from the proper authority for almost all construction.

Advertising must not be false or misleading, prohibited by law, or restricted by the seller. Furthermore, all signage must fully comply with local government regulations. In cases of non-compliance, members may be in contravention of the REALTOR® Code and/or the Rules of Cooperation and may become the subject of an investigation and disciplinary action by the FVREB’s Professional Conduct Committee.

Source: FVREB Professional Standards