Advertising laws cause confusion, concern (OR: March 2010)

by Peg Ritenour
Vice President
Legal Services

The Legal Assistance Hotline has been one of OAR’s most utilized services since it began in 1986. Available to principal brokers and managers the broker authorizes, the purpose of the Hotline is to provide general legal information regarding topics relative to the practice of real estate.

One of the areas in which brokers and managers frequently have questions is that of advertising. Below is a sampling of frequently asked questions regarding the marketing of properties and team advertisements.

Q. Can I advertise FSBO property?
A. To advertise FSBO property you would need the owner’s written consent to the advertising and include in the ad that it is FSBO or unlisted.

Q. I want to send out a newsletter to the area I “farm” that includes a list of properties that are currently on the market in that neighborhood. I have some of those properties listed, but several are listed with other brokers. Am I required to obtain consent from the other listing brokers for this type of marketing piece?
A. Yes. In order to advertise another broker’s listings you must first obtain written consent from the “owner” or the “owner’s authorized agent.” On property that is exclusively listed with another broker, the listing broker or agent would be considered the owner’s authorized agent. Therefore you would need written consent from the listing broker or agent to include their listings in your newsletter. Moreover, if consent is given, you must also include the listing broker’s name in the newsletter.

Q. Can the consent be obtained from the listing agent, or does it have to come from the agent’s broker?
A.The rule states that you must have the consent of the owner or his “authorized agent.” That could be either the listing broker or the listing agent.

Q. Does the rule specify the manner in which I must display the name of the listing broker?
A. Yes. You must use a type size that is the same as, or larger than, the type size used to describe the property.

Q. Could I go around the listing broker and agent and get consent from the owner directly?
A. While license law would not prohibit this, the Code of Ethics provides that REALTORS cannot take any action that is inconsistent with the exclusive agency relationship another REALTOR has with his/her client. Standard of Practice 16-13 further clarifies that “all dealings” concerning a property that is exclusively listed must be carried on with the client’s agent or broker. Therefore, your ethical obligations as a REALTOR would preclude you from contacting the owner rather than the listing agent or broker.

Q. If my buyer requests that I send him a list of the 4-bedroom properties available in the area, do I have to include the listing broker’s name on the properties my brokerage does not have listed?
A. No. Providing the requested information to your buyer would not be considered advertising. Ohio Administrative Rule 1301:5-1-02 (I) provides that the term advertising does not include a private communication between a licensee and a client, customer or prospective client provided the communication is initiated at the request of the client, customer or prospective client.

Q. Three of my agents have formed a team called The Smith Team. Can they advertise in just the team name or do they need to include their individual names, along with the team name in the ad?
A. At least one agent’s name must appear in the ad with the team name. It is not necessary to include the names of the other two agents in the team.

Q. I have a team of three agents. I use my full name in the team name (The Jane Smith Group). Does this meet the license law requirement of having at least one licensee’s name in team advertising?
A. Yes. As the team name includes the full name of a licensee as it appears on her license the requirement is met.

Q. Must team advertising include the name of the brokerage the team members are licensed with?
A. Yes. License law requires the brokerage name in all team advertising.

Q. Can the team name be more prominent than the brokerage name?
A. No. Neither the team name nor the name of the licensee(s) affiliated with that team can be more prominent than the brokerage name.

Q. Must an unlicensed team member be identified as unlicensed if their name is included in the advertising?
A.Yes.

Q. A team in my office wants to include a team photo in their advertising. Must every person in the photo be identified in the ad?
A. No. As long as the team advertising rule requirements are met–at least one licensed team member’s name is included in the ad, the brokerage name is included and the brokerage name is at least equal in prominence to that of the team name and agent’s name–it is not necessary to identify every person in the photo.

For more FAQs on advertising, visit the Legal section of OAR’s Web site, www.ohiorealtors.org.