Real Estate Ethics
“Duties To The Public”
Thanks to all of you who have let me know how much you appreciate the recent “Ethics Articles” that has been shared in the past few editions of the Pinewood News. Although it is rather dry material, it is important to understand how realtors should interact with their clients as well as with one another. Many of the Code of Ethics relating to “Duties to the Public” seems common sense, but nonetheless, we will review them in order to remind everyone about the state and federal requirements that are also part of the code.
Article ten requires that all Realtors shall not deny equal services to any person for reasons of race, color, religion, sex, handicap, familial status, national origin or sexual orientation. No discrimination is tolerated. Additionally, standard of practice 10.1, states that a Realtor may not even volunteer information in regard to any of these protected statuses. Standard 10.2 enforces realtors to divulge in reasonable detail information used in the development of demographic information resulting in a market analysis price assessment. Standard 10.3 states that Realtors may not print display or circulate any statement pertaining to the sale or rental of a property that indicates any preference to a specific class or prejudice against a specific group or class. So, a realtor or broker who name calls an individual, a client or another realtor would be breaking this particular Code of Ethics. It is hard to believe that a “Code of Ethics” would have to apply in today’s modern work environment between the general public and any realtor or between realtors themselves but AAR (Arizona Association of REALTORS), states it is not an unusual occurrence.
Article eleven requires that Realtors limit their representation of a client to standards of practice and competence which are reasonably expected in specific real estate disciplines. A residential agent should not try to handle a commercial transaction if they have no knowledge or experience and vice versa. Article 11.1 covers realtors’ preparation of opinions of real property value or price and the requirements associated with that task. The remainder of article eleven deals with consultative services and appropriateness of fees and information
Truthful and honest advertising and statements comprise Article 12 and require that Realtors ensure the accuracy of their claims and that they disclose properly any advertising of “free” benefits to others of themselves when advertising real estate. The offering of premiums, prizes, merchandise discounts or other inducements to buy, sell, list, purchase or lease must be accurately disclosed as well as all of the terms and conditions of these offers.
Article 12.4 and 12.5 requires that agents have authority to offer property for sale or lease and that prices may only be quotes as approved by the owners of the property. Furthermore, the property, when advertised, must include all pertinent factors relating to the listing including company name, broker name, agent name, except in instances where it is not reasonably feasible. 12.6 states that all agents must disclose when they have any interest in a property for sale or lease, such as Owner/Agent. In addition, agents may only advertise the term “SIOLD” when they are the listing agent or the cooperating agent in transactions that result in a close of escrow. Realtors are supposed to keep online information and website information current, and must disclose if they intend to use online obtained information to advertise or promote for other purposes.
Realtors are not allowed to “practice Law”, by engaging in activities that would normally require legal interpretation and must also cooperate with any and all investigations concerning alleged violations of the code of ethics as supervised and determined by the AAR. While commonly misused and/or abused by both the general public and realtors alike, the process requires that all realtors participate should a filing occur and ensure that no intentional obstruction occurs.
Finally, realtors who are found to be instrumental in the filing of investigative or disciplinary complaints in order to induce multiple ethics violations on an individual or specific real estate company based upon improper or unsubstantiated complaints can be found guilty of intentionally impeding a boards investigative or disciplinary process and can be brought up on charges of willfully misusing an AAR process. Surprisingly, this kind of misuse of the system is not uncommon. The most common complaint filed will be covered in the final chapter of “Ethics Reviewed” in the next edition of the Pinewood News. This section covers “Duties To Realtors”, and will overview the importance of how REALTORS behave with one another.
If you have a specific question or would like to see a particular real estate area , practices or law covered in a future news article, please drop me a line at Bill.Spain@ProvidentAZ.com or call me at 602-622-1196. As always, Thank You for your business, your confidence and your trust is assisting you with your real estate needs in Munds Park, Northern Arizona and the Greater Metropolitan Phoenix Area. Provident Partners Realty & management is “Your Partner In Pinewood.”
By Bill Spain
Provident Partners Realty