Summary: Advertising Guidelines for Real Estate Agents in...

Posted on: Monday, October 22nd, 2012

As a real estate agent in Ontario it is important to understand the various statutes and regulations that are applicable to the way in which you advertise your services. The Real Estate Committee of Ontario (RECO) has published various documents on advertising guidelines which contain important information on the minimum requirements that must be met within advertisements, the prohibitions that apply to advertisements, and finally, the consequences that are associated with non-compliance.

The guidelines are a helpful way to ensure that your advertisements comply with the Real Estate and Business Brokers Act, 2002, S.O. 2002, c. 30, Sched. C, (REBBA) and Ontario Regulation 580/05 under the Act, which is the Code of Ethics for realtors. The most notable change in the new guidelines is that they do not contain any requirements pertaining to contact information. Also, there are no restrictions in relation to words that are used to describe a real estate sales “team”.

It is important to understand that advertising practices of realtors are not limited to the scope of these two advertising laws, but that there are other federal, provincial and municipal laws which may apply. For example, the Competition Act, the Personal Information Protection and Electronic Documents Act (PIPEDA), trademark and copyright statutes, provincial consumer protection legislation, and applicable municipal by-laws.

What are the minimum requirements that must be met?

The Code of Ethics sets out four minimum requirements that must be included in all forms of advertising. These requirements are outlined in section 36 of the Code and are as follows:

1. Identification of the registrant: the name of the registrant (salesperson, brokerage or broker) must be clearly and prominently placed in the advertisement. This relates to the size and legibility of the printed name, the location of the name in relation to other elements of the advertisement, the frequency that the name is used, when the name is used, and how quickly the name is referred to.

2. Identification of individuals: the name that is used to identify an individual realtor, broker, or salesperson must be the same name that is registered with RECO. If two registrants share a common last name (related, married etc.) they are permitted indicate this jointly (John & Mary Smith, Brokers).

3. Identification of brokerage: realtors must include the name of the brokerage that they are employed by, and this name must be the same as the one registered with RECO.

4. Description of the registrant: when a particular registrant is identified, the specific description of what the registrant does must be included. The following conditions apply:
a. a salesperson must use the terms “salesperson”, “real estate salesperson”, “sales representative” or “real estate sales representative”;
b. a broker must use the terms “broker” or “real estate broker”;
c. a broker of record must use the terms “broker of record” or “real estate broker of record”;
d. a brokerage must use the terms “brokerage” or “real estate brokerage”; and
e. when multiple registrants are identified in larger advertisements and listing these titles would take up to much space or create clutter, the registrants involved are permitted to include a symbol such as an asterisk to denote that the description occurs throughout the advertisement and applies to all.

If you are unsure of what the registered name on RECO is you can confirm this information on MyWeb, or through RECO’s website at www.reco.on.ca.

What are the prohibitions that apply to advertising?

Specific prohibitions pertaining to advertising are included in various sections of REBBA 2002, as well as section 36 and 37 of the Code of Ethics. The main prohibitions are as follows:

1. Registrants must not use terms that could confuse the audience about the registration status of the registrant. For example, terms such as “sales agent”, “sales associate” or “sales consultant” are not permitted to be used.

2. Registrants must not include anything that could indicate the identity of parties that have been involved in the transactions they have completed, unless written consent has been obtained from that party. This consent can be obtained independently, or a registrant can include a condition within the customer service agreement or the terms of a representation agreement.

3. Registrants must not include anything in the advertisement which could be used to identify a particular property that they are associated with, unless the brokerage has the written consent of the property owner (whether it be the buyer or seller).

4. Registrants must not include any details of the agreement regarding a real estate transaction (such as price) unless written consent of all parties has been obtained.

5. Finally, as outlined in Section 37 of REBBA 2002, there are general prohibitions against including any “false, misleading or deceptive statements” and/or inaccurate representations. Basically, as outlined in the guidelines, “you must say what you mean, and mean what you say”.

If you fail to comply with these requirements and prohibitions you will be contacted in writing by the Registrar who will inform you of the non-compliance and identify the issue. They will request that you take the appropriate actions to correct the errors identified and inform them of when the corrections have been made. If the registrant fails to correct the advertisement, formal action may be taken by the Registrar. This could include sanctions imposed by the Discipline Committee, a formal compliance order issued by the Superior Court of Justice, or prosecutions issued at the Provincial Offences Court.

All of this information can be obtained directly from RECO’s website, along with more in depth descriptions and various visual demonstrations of both correct and incorrect advertising. There are a number of resources available to real estate agents, such as an Advertising Checklist and Advertising Guidelines, which should be referred to and can be found at the following website: RECO Advertising Guidelines.

The content of this blog is intended to provide a general guide to the subject matter. The information does not constitute legal advice and a solicitor and client relationship is not created.

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