When can an agent legally and ethically advertise a property for sale to the public? It’s a question that pops up consistently in the Iowa Association of REALTORS® legal department.
The simple answer is this: You can only advertise property to the public when you have an agreement with express authority to advertise.
Iowa law and the National Association of REALTORS® Code of Ethics are clear on the need to have an agreement before advertising the property.
14. “Listing” is an agreement between a property owner and another person in which that person holds or advertises the property to the public as being available for sale or lease.
The plain reading of 543B says there needs to be a listing agreement between a property owner and person or licensee before advertising the property to the public. If there is no listing agreement, then a person does not have the right to hold out/advertise property.
NAR Code of ethics is more direct:
Standard of Practice 12-4: REALTORS® shall not offer for sale/lease or advertise property without authority. When acting as listing brokers or as subagents, REALTORS® shall not quote a price different from that agreed upon with the seller/landlord. (Amended 1/93)
Despite these rules, IAR receives numerous questions on this topic. Here are some of our most commonly received questions answered.
Delayed Showings/Coming Soon: What is it?
Delayed Showings/Coming Soon is a specific policy that a local board/associations or state association can adopt related to their MLS rules. A property that has a fully executed listing agreement between the listing agent and seller and is entered into the MLS with a note that the property is not immediately available for showings is considered a Delayed Showing/Coming Soon. The property cannot be publicly advertised except for being on the MLS , this does not conflict with Clear Cooperation. The Delayed Showings/Coming Soon policies often have specific timelines for when a home must be shown and the procedure for switching that property over to an “Active” status. These policies are permissible by NAR and can differ across the state.
However, IAR often hears confusion over “Coming Soon" advertisements. Some agents are announcing that a property will soon be coming to the market and no listing agreement has been signed between the agent and the property owner and it is not listed in the MLS. The “Coming soon” announcement could be as vague as “new home in this area is about to be listed” on a social media post with a specific address and pictures. This practice is not permissible. Not only is there likely a Clear Cooperation issue, but it is a violation of Iowa law and NAR Code of Ethics. An agent should only be advertising a property for sale if they have authority to do so. Iowa law states that authority exists with a listing agreement.
Advertising Other Agent’s Property on Social Media, is this Allowed?
A consistent and controversial question is whether it is permissible for agents other than the listing agent or another agent within a brokerage to share and promote property where no contractual relationship exists with the property owner.
For example, an agent or team who posts on social media that their buyers have a property “under contract” and show a picture of the property with their own branding and logos without crediting the listing agent or listing brokerage. Is this allowed?
Reviewing Iowa law and NAR Code of Ethics, the argument leans toward this being impermissible. Advertising property requires a certain grant of authority. If you do not have a specific grant of authority, then you should avoid advertising.
Some agents argue that sharing property listings on social media is not any different than an IDX feed showing property from the MLS. First, the MLS is a system of listings that participating REALTORS® use to promote property and form deals. Sellers are often aware their property will be listed on the MLS for promotion and sale purposes. The listing is added with other listings to make a feed of available houses. IAR believes this is different than an agent who is specifically promoting a particular property though they were not given authority. Second, those IDX feeds provide important information as to who the listing agent and brokerage is and specific contact information. Not all agents uniformly follow the same standard of providing vital information attached to a listing.
Additionally, there is the wrinkle of who actually owns the photographs. Does the agent? The brokerage? The owner? The photographer? Who was given license to use professional photographs? What is the scope of the license? Can only a particular agent use it or can the photograph be shared? Is there copyright issues if the photos are shared by agents outside of the brokerage? All these questions show the potential dangers of sharing photos without express permission.
All that being said, IAR understands that agents and teams will continue to share properties online and promote “under contract." IAR recommends that, at a minimum, the listing agent and brokerage of a property be credited on a social media post in some capacity. The better practice would be agents asking permission from the listing agent or entity who has the contractual relationship with the property owner (and potentially the photographer) to use photos of the property in their respective social media posts.
Remember, these laws and rules are not meant to cause hurdles to your marketing practices, it is meant to protect the public. As long as it does not conflict with federal and state laws and NAR Code of Ethics, a seller has significant control over how their property can be advertised. REALTORS® must keep in mind that all the restrictions and limitations put on advertising property is to protect the interest of the client.
When Must I Take Down My Yard Sign?
REALTORS® love to promote their brand to the public. It is vital to keep getting clients and marketing for future opportunities. However, one frequent complaint IAR receives involves when REALTORS® fail to take their yard sign down after a property has been sold. So, when are you supposed to stop advertising?
Iowa administrative rules provides an answer:
193E—10.3(543B) Signs on property. Placing a sign on any property offering it for sale, rent, lease, or exchange without the written consent of the owner shall not be considered in the best interest of the general public.
10.3(1) When a listing expires, unless a new written listing or extension is obtained, the licensee shall immediately cease advertising and active marketing of the property. The licensee shall make every reasonable effort to remove signs as quickly as possible.
10.3(2) The licensee shall make every reasonable effort to remove signs from the property after the transaction is closed. Sold signs and other signs shall not be left on properties without the written consent of the new owner of record.
The two triggering events that require you to remove a sign from the property is the loss of authority when a listing agreement expires and the close of the transaction. At that time, an agent must make take “every reasonable effort” to remove signs from the property. 10.3(2) goes further stating that you must remove the signs unless you obtain consent of the new owner of record.
So, what is a “reasonable effort” to remove a sign? One day after closing? Two days? Five days? IAR recommends removing the sign within 24 hours, but it would be best to do so even sooner. If you are leaving signs out longer than 24 hours, you run the risk of receiving a complaint to the Iowa Real Estate Commission and potentially loss of the sign if the new owner disposes of it. Further, it may negatively impact your brand in your local community.