What are the Rules?
Not only is ambiguous advertising thought of as a disservice to customers, but the practice carries with it serious legal implications, as well. To better understand how the various laws and statutes apply in situations specific to real estate, Better Business Bureau of Greater Houston and South Texas Director of Investigation and Media Relations Monica Russo shared her insights.
“Generally speaking, we look at false claims of status as a form of ‘puffery’ advertising,” she said. “However, saying you’re the No. 1 agent in Houston is one thing. Saying you’re the No. 1 top selling agent in Houston may be another and may cross the threshold.”
In Texas, Chapter 17 of the state’s Business and Commerce code, labeled “Deceptive Trade Practices,” clauses 2, 3, 4, 5, 7 and 8 of the subsection specifically address the usage of false advertising. They read:
Sec. 17.46. DECEPTIVE TRADE PRACTICES UNLAWFUL.
a. False, misleading, or deceptive acts or practices in the conduct of any trade or commerce are hereby declared unlawful and are subject to action by the consumer protection division under Sections 17.47, 17.58, 17.60, and 17.61 of this code.
2. causing confusion or misunderstanding as to the source, sponsorship, approval, or certification of goods or services;
3. causing confusion or misunderstanding as to affiliation, connection, or association with, or certification by, another;
4. using deceptive representations or designations of geographic origin in connection with goods or services;
5. representing that goods or services have sponsorship, approval, characteristics, ingredients, uses, benefits, or quantities which they do not have or that a person has a sponsorship, approval, status, affiliation, or connection which he does not;
6. representing that goods or services are of a particular standard, quality, or grade, or that goods are of a particular style or model, if they are of another;
8. disparaging the goods, services, or business of another by false or misleading representation of facts;
Separate from state law, false or misleading advertising is a practice expressly forbidden by NAR’s Realtor Code of Ethics, which is updated every year. In article 12 of the document, the language clearly states that Realtor members “shall be honest and truthful in their real estate communications and shall present a true picture in their advertising, marketing and other representations.” Failure to do so, while not resulting in legal action, could cost a Realtor their membership, as well as the accompanying perks.