Realty Times - Reducing Your Risk When Placing Advertisements

Front Page

Ultimate Real Estate Success SuperConference

NEED HELP?

Click for Live Support

Call: 214-353-6980

Reducing Your Risk When Placing Advertisements

by Dave Crawford

Advertising your clients’ properties in publications can give you a tremendous advantage in your market. Properties that are advertised can be seen by more potential buyers and may sell more quickly than properties that are not advertised. In addition, ads give you an excellent opportunity to highlight features that set your properties apart from others.

Placing an ad seems like an easy, trouble-free endeavor. And for the most part, it is. However, you may not be aware that advertising for sales of real estate is subject to the U. S. Federal Fair Housing Act of 1968 as amended. This Act makes illegal any advertisement which shows any preference, limitation or discrimination based on race, color, religion, sex, handicap, family status or national origin or an intention to make any such preference, limitation or discrimination.

The assassination of Dr. Martin Luther King on April 4, 1968, prompted passage of Title VIII of the Civil Rights Act of 1968, known as the Fair Housing Act. Since the bill was signed, HUD has received about 5,000 complaints a year. In the past nine years alone, complainants have received more than $42 million not including amounts won through adjudication.

You can help protect yourself from being involved in complaints and lawsuits by following some simple guidelines:

Advertising should not include any discriminatory language. It is unlawful to discriminate in the sale, rental, or financing of a house because of race, color, religion, sex, handicap, familial status, or national origin. No references should be made that indicate any preferences, limitations or discriminations because of those factors.

To help avoid liability, obvious discriminatory words should be avoided. Other words, not so obvious, have been interpreted by the courts to violate the Fair Housing Act when used in certain contexts so care must be used when using them. These potentially discriminatory words include but are not limited to:
Adult, Bachelor, Couple, Family, Mature, No Children, One Person, Retired, Sex, Single, Christian, Executive, Exclusive, Handicap, Membership Approval, Mentally Ill, Religious, Senior Citizen, Race, Restricted.

Not every appearance of these words is prohibited; however, you must remember to be careful when using them. For example, "Perfect for your Family" is acceptable but "Only Families considered" is not.

Advertising which uses the legal name of an entity containing a religious reference may be used as long as the ad includes a disclaimer like, "This home does not discriminate on the basis of race, color, religion, sex, handicap, familial status, or national origin". So it is perfectly acceptable to say, "This home has a Catholic chapel within walking distance" because that does not state a preference for specific religions. But it is not acceptable to say, "Catholic families preferred." Be sure to use the previously mentioned disclaimer.

Some other items to remember:

Ads for single-family dwellings or units in a multi-family dwelling should contain no explicit preference, limitation, or discrimination based on sex

Ads should not contain explicit exclusions, limitations, or other indications of discrimination based on handicap

Ads describing the conduct of an occupant do not violate the Fair Housing Act, so it is fine to say "Quiet neighborhood" or "no smoking allowed"

Ads may not contain limitations on the number or ages of children, or state a preference for adults, couples or singles

"Using discriminatory language when advertising could subject you to actual damages, punitive damages which could potentially reach hundreds of thousands of dollars, court costs, attorney’s fees as well as injunctive relief" says Alicia Klyman, an attorney for American Home Shield. "It is unlawful to make, print, or publish anything that uses discriminatory or misrepresentative language. This could subject the Realtor® and his or her broker to liability under several federal laws including, but not limited to, the Fair Housing Act."

Generally, under agency principles, the broker may be found responsible for an agent’s actions within the scope of his or her employment. Therefore, the agent and the broker may potentially be held jointly accountable for any legal action taken against the agent.

Advertising should accurately reflect the property being offered.

When placing ads, be sure to represent the property truthfully, with no misrepresentation of the conditions of the property, or the items it contains.

"Making misrepresentations regarding property could lead to claims of fraud, misrepresentation, negligent misrepresentation, as well as a potential void of contract of sale if the purchaser becomes aware of the misrepresentation," Klyman says. "The purchaser could sue under a contract theory of misrepresentation under the terms of the contract. This could result in a void of the sale or payment of damages for any actual damages the buyer has incurred."

Klyman adds that misrepresentation of property can be as simple as mentioning that an appliance is "new."

"For example, if the agent advertised that the air conditioning unit was brand new and in fact, it was ten years old, the purchaser could sue for the price of a new air conditioner," Klyman says. "Or the purchaser could file an action for breach of contract and request that the sale of the home be considered void."

Ads can give you an edge in your market. Just make sure that you are truthful and impartial when representing your properties and their neighborhoods.

Published: February 8, 1999

Use of this article without permission is a violation of federal copyright laws.

Real Estate News Network