Licensing Board Rule .0105 prohibits brokers from advertising the sale, exchange, rental, etc. of real estate for others in such a way as to make it appear that it is the advertisement of an owner.

Since some persons feel that they can save money or obtain a more favorable deal by negotiating directly with the property owner, they are naturally attracted by advertisements of properties "For Sale by Owner"; i.e., properties which are not being offered through a real estate broker or agency. These persons are then understandably irritated when they call the telephone number listed in an anonymous ad and find that they are, in fact, speaking with a real estate broker or salesman.

The Licensing Board considers the use of "blind ads" deceptive (a "bait and switch" tactic) and cautions brokers to properly identify themselves in all advertisements of listed properties. The questions arise, however, as to What is meant the term "advertisement"? and What constitutes proper identification?

In answer to the first question, the types of advertising contemplated by this Rule include newspapers, radio, television, business cards, office signs, yard signs, stationery letterheads, billboards, and all other forms of notice designed to attract public attention to the broker or brokerage firm. Although advertisements of real estate owned by the broker or salesman are exempt from this Rule, the Licensing Board nevertheless encourages licensees to identify themselves as brokers or salesmen in all real estate transactions and advertisements so that the parties with whom they deal will be put on notice as to their superior knowledge in real estate matters.

As to the question "What constitutes proper identification?", the Board's Rule regarding advertising requires that "Every such advertisement shall clearly indicate that it is the advertisement of a broker or brokerage firm". This not only means that the advertising must reveal the exact business name registered with the Licensing Board, but also requires that additional words or terms be included if necessary to identify the individual or firm as a real estate broker. For example, if the registered business name does not contain such identifying words as "broker", "real estate", "realty", "agency", "Realtor", or "Realtist", then the words "Broker" or "Real Estate Broker" should be included in the advertisement so that the public will be aware that the property is being offered by a person or persons engaged in the real estate business. Salesmen are further required to include the name of the broker and firm with whom they are associated in all advertising with the broker's name being displayed in equal prominence to the salesman's name.

Check your advertising to make certain that you or your firm is clearly identified as a real estate broker ' and compare the name listed on the address of this Bulletin with the name under which you are operating to verify that you are advertising under the name currently registered with the Licensing Board.

It is common for real estate brokers to list their available properties in the want-ad section of the local newspapers. Many advertisements contain substantial information regarding the property, even the location and price on occasion. Is it possible for a prospective purchaser to use this advertisement as an offer, and force the seller to sell on the advertised terms?

The basic common law rule provides that generally, advertisements are not offers to sell, and the owner cannot be made to sell at the advertised price. The cases refer to such advertisements as "invitations to negotiate". If a seller advertised his home for sale at given prices and terms, a buyer cannot "accept" this offer and demand the transfer of the property. An advertisement giving the offered sales price of a home is not considered under the common law to be an effective offer. Even a picture of the home supported by substantial detail of the property cannot be considered an offer.

Many errors arise in newspaper advertisements, and the price of the property could be inadvertently misquoted. The owner would not be required to sell at the misquoted price, as the newspaper advertisement is not an offer to sell. Unfortunately on occasion real estate brokers have been known to run advertisements of fantastic "bargains" in real estate just to generate telephone calls. This is a violation of business practices acts in most states, and could be construed as fraud of such a nature as to revoke a license.

The rule also applies to catalogs, price tags, and circulars "offering" property for sale. These have not been construed to be an offer in the technical sense, so they could not bind the owner to sell at the advertised price. Even letters requesting prices have been construed as "invitations to negotiate" and not offers to sel1.

CAVEAT: Advertisements of real estate for sale in newspapers are not "offers" to sell. A prospective purchaser cannot "accept" such an offer to create a binding sales agreement. Such conduct could be a violation of your state business and commerce code if knowingly placed by a real estate broker.

-Living Real Estate Law May 1977