Bruce Aydt, REALTOR® Magazine columnist and real estate ethics instructor, receives hundreds of questions a year from REALTORS® who are confronting various ethical dilemmas. Here are some of the most prevalent problems that he's seen in the past year.
Not revealing your state of licensure. On your Web site, you need to include a note disclosing the state in which you hold your real estate license. The note could say something like "Licensed in Illinois," "Illinois Licensee," or "Illinois Broker."
Blogging or tweeting without making company affiliation evident. In any real estate–related communications on Facebook, Twitter, or other social media sites, you must include your company name in the posting or make it accessible via a link back to your company name (like your username’s link to a profile page). Your company name also must appear in all advertisements.
Failing to disclose a short sale. You have an obligation to know your MLS and state license law rules on short sales and to disclose a potential short sale when it’s required in those rules.
Allowing false or misleading comments on your sites. You should monitor your blogs, Facebook wall and pages, and other electronic media regularly for any false or misleading comments about others, and immediately remove any that you find.
Giving unauthorized access to your listings. You should make it clear to cooperating agents that they’re expected to accompany buyers to the house and aren’t permitted to provide the lockbox combination to buyers.
Flipping, flopping or ignoring conflicts of interest. Flipping and flopping are typically associated with short sales and involve clients buying a property from the lender at a discount and then selling it at a premium shortly afterward—often as soon as the next day. The inherent conflict is in the price differential, since there’s no improvement to justify the difference in price.