Advertising and Business Practices
What to know
Advertising rules require that all marketing be truthful, not misleading, and identify the responsible licensee or brokerage. Candidates must understand rules on blind advertising (ads that omit the brokerage name), use of team names, testimonials, comparative claims, and solicitation of listings. Know that advertising must not create a reasonable impression that a property or service has characteristics it lacks.
Traps
- Blind ads: an ad that promotes a property or service without the brokerage name may violate identification requirements.
- "Free" and "guaranteed" claims are scrutinized; they must be literally true.
- Testimonials must be genuine and not misleading in context.
- Solicitation of a listed property's owner to break a listing is prohibited conduct.
- Online and social media advertising is subject to the same rules as print.
Rule of thumb
Apply the reasonable consumer standard: would an ordinary person be misled by the ad as a whole, not just by one technically accurate phrase?
Worked example
A licensee advertises "No commission - save thousands!" while charging a flat transaction fee. The ad is misleading because the consumer reasonably reads "no commission" as no cost to them. The correct answer identifies the ad as deceptive even though no percentage commission is charged.