LEGAL SOCIAL MEDIA RISKS FOR REALTORS p

N E W S , T R E N D S , & T O O L S F O R R E A LT O R S ®

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Legal Social Media Risks for Realtors®

BY TEAH HOPPER

Social media is a revolutionary, life-changing tool with so many benefits. In just a few years it has completely changed the way that we communicate, interact, keep in touch with old friends and connect with new ones. Social media is great in business and in real estate. It provides easy exposure, increases your reach and audience, offers a source of referrals and it is free! But social media can be risky. Technology is outpacing the law and the rules are shades of gray rather than black and white.

Be Aware of these Risks

We have all heard the stories. The smart, well-respected business professional that should have known better, but made a bonehead mistake on Facebook, costing them their job and self-dignity. It all seems like common sense, but people keep doing it. The thing about social media is that when you make a mistake – it is there for the world to see. Even when you delete it – it doesn’t go away. When it comes to real estate, there are some serious legal risks to be considered. Here are a few of which you should be aware: 1. Code of Ethics – As a Realtor®, you are subject to the Code of Ethics, and the Code applies to the digital world. Review the Code with your social media strategy in mind. 2. Online Advertising – All the rules that apply to traditional advertising apply to online advertising. Remember this the next time you create a Facebook campaign. 3. Plagiarism – If you copy or share someone else’s work (whether ideas, text or images) be sure to give them credit and properly attribute the author. 4. Fair Housing – Be careful that what you post doesn’t violate Fair Housing laws or it could be interpreted as discrimination. In the world of 140 characters it is much easier to miscommunicate. 5. Anti-trust – Any activity that amounts to an unreasonable restraint of competition is a violation of antitrust law. 6. Disclosure Issues – Be careful not to share or disclose private or confidential information entrusted to you as a Realtor®. Oversharing is a true temptation of social media. 7. Defamation – Everyone is braver behind a keyboard.

Making an insulting or libelous statement or comment online is still considered defamation. 8. Intellectual Property Infringement (including copyright and trademark issues and DMCA) - When you post or share anything online that is protected by copyright or trademark without the permission of the creator, you could be guilty of copyright infringement. When it comes to avoiding risks, it is best to play it safe. If you are unsure how it could be interpreted, don’t post it.

Do’s and Don’ts

Here are some guiding principles to keep in mind when writing your own personal social media policy and to help you keep it legal.

Do:

■ Be yourself. Share what you are passionate about and what makes you uniquely you. This is how people will connect with you. People do business with you because they like you and have something in common with you. At the same time, allow others to be who they are. Be thoughtful and have a filter. ■ Be transparent. Be you but be forthcoming about your job, connections, associations, and ties. If you do mess up, own up to it. ■ Comment cautiously. It’s not just your posts that other people see but the comments you make on others posts are viewable by anyone and show up in feeds. Offer solid points and represent yourself in discussions – without arguing, disagreeing with, or insulting others. Don’t risk looking like a bully to win an online argument. Your reputation and your brand is worth more than that. ■ Be open-minded to others' points of view. Again, it is social media – if you are going to engage, be open and accepting of others ideas and realize that not everyone thinks like you. This is the point – to share and learn from one another. You don’t have to agree, but do be respectful. ■ Educate buyers and sellers of the risks involved. You are not the only one at risk. Remind your clients that posting details about prices and purchases could be detrimental. ■ Be neutral on controversial topics. Politics, religion, race,

and other sensitive topics are considered taboo so be cautious when discussing them on public platforms. When the conversation gets heated, it is best to stay away. Remember, it all comes back to you, your brand, and your business. Don’t give your clients a reason to not use you or refer you. ■ Maintain your profiles proactively. Use a current profile picture that looks like you and be sure your bio represents who you are. Your online profiles are often the first impression someone has of you. And we all know the importance of first impressions.

Don't:

■ Don’t friend everyone. Be selective about who you accept as a friend or connect with. When you determine your purpose for each page, think about your audience. If you intend to keep your personal page personal, then don’t accept requests from people you don’t know. Manage your online world wisely. ■ Don’t spam or sell. Be human and be real. Use social media to connect with people and form relationships. Posting nothing but automated listings will just annoy people. Being too “salesy” is a turn off too. People use social media for the human interaction – not to be sold to. ■ Don’t vent. Do not use social media as your personal journal. Do not vent about clients, coworkers, or other agents. ■ Don’t talk about clients or deals. You may be excited about that deal you just closed but don’t risk ruining it by oversharing on social. Even if you are vague about the details, be very cautious. ■ Don’t assume your friends, family, or clients have the same views as you on religion, politics, or social issues. We all know what assuming does. ■ Don’t assume anything on social media is private – this includes private groups and direct messages. It is way too easy for someone to take a screen shot of your “behind closed doors” comment and use it against you. Be cautious of anything you put in writing. ■ Don’t let social media take the place of face-to-face interaction. Your online presence should augment who you are in person. Use it to connect but don’t let it take the place of the real thing. Social media is fun, exciting, and, when used correctly, rewarding. However, it takes work to make it work. Put the time in up front. Practice strategy and discipline and be aware of the risks. Remember that you are representing yourself, your business, and the real estate industry as a whole. Represent well!

COVID-19 Updates

BY THE MAR LEGAL TEAM

The COVID-19 global pandemic has caused massive disruptions to the real estate industry. MAR has been working diligently throughout the crisis to ensure that our members have the latest information and the resources they need to successfully navigate through these uncertain times. MAR has been advocating on behalf of Realtors ® and producing much needed forms updates. Three new forms have been added to our library that specifically address COVID-19-related transactional issues.

Smoke and Carbon Monoxide Inspection Addendum

The inability to obtain a smoke certificate during the pandemic does not mean transactions are stuck in limbo indefinitely. MAR advocated to secure a solution to this issue. On March 20, 2020, Governor Baker issued an emergency order that permits home buyers and sellers to defer the smoke and carbon monoxide detector inspection requirements that are otherwise required under the General Laws of Massachusetts. MAR is now working with the Fire Prevention Association of Massachusetts to ensure that all required deferred inspections are completed within 90 days of closing. During the current COVID-19 State of Emergency, a Smoke Inspection may be deferred so long as the following conditions are met:

1. The parties to the sale or transfer have agreed, in writing, that the buyer assumes responsibility for equipping the property with approved smoke detectors and carbon monoxide alarms.

2. The buyer agrees as a condition of taking title to equip the property with approved smoke detectors and carbon monoxide alarms immediately upon taking title.

3. An inspection as otherwise required under Massachusetts General Laws Chapter 148, Sections 26F and 26F1 ⁄2 occurs no more than 90 days after the state of emergency is lifted. MAR has developed an addendum that addresses the requirements of the emergency order. The addendum can be found through the MAR Forms Library or may be accessed on www.MARCOVID19.com.

COVID-19 Addendum

In addition to the Smoke and Carbon Monoxide Inspection Addendum mentioned above, MAR also developed a COVID-19 Addendum to address any delays that may occur as a direct result of COVID-19. This addendum may be attached to a contract to purchase to provide protection to the parties in the event a transaction is disrupted during this uncertain time. This form is also available through the MAR Forms Library or www.MARCOVID19.COM.

Short-Term Rental Cancellation Addendum

On March 31, 2020, the Department of Public Health (DPH) issued guidance for one of the Governor’s emergency orders prohibiting the use of hotels, motels, inns, bed and breakfasts, and short-term rentals for vacation or recreational purposes through May 4, 2020. To assist our members brokering short-term rental contracts for stays beginning after May 4, MAR has developed a short-term rental cancellation addendum that may be attached to those lease agreements. This addendum addresses deposits placed on those rentals, and what happens in the event the landlord is unable to provide occupancy or the tenant is unable to travel to the property to take tenancy as a direct result of the coronavirus/COVID-19 pandemic. The addendum can be found through the MAR Forms Library or may be accessed on www.MARCOVID19.com. Any additional forms developed for use by a brokerage should be done so with the guidance of legal counsel. Additionally, any “screening” type questions, such as questions about where a person has traveled or whether they are experiencing any symptoms of illness, must be asked equally to avoid any fair housing issues.

Massachusetts has some of the oldest housing stock in the country, and although the federal government banned the use of lead-based paint in homes more than forty years ago, lead poisoning is still a significant issue in Massachusetts real estate. A recent Massachusetts settlement in a lead poisoning case highlights the importance of compliance with the lead laws. In this case, the child lived in a rental property that was owned by two separate landlords during the term of the rental. The child suffered from lead poisoning after the property was sold to the second landlord. Prior to going to trial, the parties agreed to settle for $375,000. The original landlord paid $175,000 of the settlement, with the remaining $200,000 paid by the second landlord. As this case demonstrates, failure to comply with the requirements of the lead law can result in significant damages. While the requirements for the law are very similar for residential sales and leases, there are very specific obligations under each transaction type. Residential Sales:

For homes built prior to 1978, sellers must provide prospective buyers with the Property Transfer Lead Paint Notification prior to entering into a contract to purchase. ■ The seller must provide the prospective buyer with copies of any documentation related to lead testing or remediation. ■ The seller must provide the buyer at least a 10-day period to have a lead inspection. ■ If a child under the age of six will live in the home, the owner is required by law to have lead hazards remediated entirely, or have the property brought into interim control, within 90 days of taking title.

Residential Leases:

■ For homes built prior to 1978, owners must provide prospective tenants with the Tenant Lead Law Notification prior to entering into a rental agreement. ■ The owner must provide the tenant with copies of any documentation related to lead testing or remediation. ■ An owner may not refuse to rent to a family with children under the age of 6 to avoid the requirements of the lead law. ■ An owner may delay the start of a tenancy up to 30-days to bring the property into compliance. ■ If a child under the age of six comes to reside in the property during an existing tenancy, the owner of the property is required to provide temporary housing for the tenants while the lead hazards are remediated. The Landlord is responsible for reasonable moving costs, but the tenant is still required to pay the agreed- upon rent during this period. Failure to comply with the requirements of the lead law may result in a civil penalty up to $1,000 under Massachusetts law, and both criminal and civil penalties up to $10,000 under federal law, as well as damages for injuries caused by non-compliance. Owners are subject to strict liability for injuries caused by lead poisoning, regardless of whether the owner had knowledge of the lead hazard. Real estate agents may also be subject to penalties for failing to ensure that their seller and landlord clients properly completed the Lead Notification Form.

Housing discrimination continues to be a concern throughout the nation. Federal law prohibits agents in a real estate transaction from discriminating on the basis of race, color, religion, sex, handicap, familial status, or national origin. Article 10 of the Realtor ® Code of Ethics prohibits Realtors ® from denying equal professional services to any person in those classes as well as on the basis of gender identity or sexual orientation. Massachusetts, which has some of the strongest anti-discrimination laws in the country, has expanded the list of protected classes beyond the requirements of the federal law and the Code of Ethics to also include gender, ancestry, genetic information, marital status, veteran or active military status, age (i.e., children), and source of income (i.e., Section 8 voucher).

Protected Class

Race Color Religion Sex Handicap Familial Status National Origin Gender Gender Identity Sexual Orientation Ancestry Genetic Information Marital Status Veteran or Active Military Status Age (i.e. children) Source of Income (i.e. Section 8)

Federal REALTOR ® Code of Ethics 

Massachusetts

Steering is an illegal practice in which prospective buyers are guided to or away from certain neighborhoods based on their identity as a member of a protected class. This practice is a violation of the Fair Housing Act and Massachusetts General Laws Chapter 151B. Regardless of whether steering is inadvertent, deliberate, or in response to questions from a client, it is unethical and illegal, because it limits the housing opportunities available to that buyer.

What the buyer asks

Is this a nice neighborhood? Is this a good school district? Is the neighborhood safe?

The information they actually want

Neighborhood demographics School ratings Crime statistics

Where to refer them

U.S. Census Bureau, Local Government MA Department of Education, Online ratings Local Police Department

Buyers may place their Realtor ® at risk of steering when they request insight into neighborhoods. One way steering can occur is through comments by an agent, either positive or negative, about a community. Realtors ® faced with inquisitive buyers should provide their clients with the resources to discover the information that is important to them. Rather than providing buyers with the answers to their questions or your own personal opinions about neighborhoods, be the source of the source. By providing access to objective information, Realtors ® can help buyers make their own decisions about communities, schools, and the homes they choose without violating the Fair Housing Act.

Katie Johnson

Talking Legal with NAR General Counsel Katie Johnson

Katie Johnson is the General Counsel and Chief Member Experience Officer of NAR.

Katie joined NAR in 2007 and was appointed as General Counsel in 2014. As General Counsel, she is responsible for assuring that the programs, policies, and activities of NAR are in compliance with the law. She also is responsible for defending the association against legal challenges and initiating litigation to protect and preserve association assets and policies. As NAR’s Chief Member Experience Officer, she leads initiatives to enhance member engagement and satisfaction through delivery of trusted knowledge, resources, and experiences that elevate member success and professionalism. Katie has earned a juris doctorate and a master’s degree for Information Technology and Privacy Law. She lives in Chicago with her husband and three children.

As general counsel of NAR, what does your typical day look like?

A. I imagine that my typical day looks familiar to many working parents. It includes getting my two, five, and eight-year-olds dressed and ready for their days ahead, dropping my twoyear-old off at daycare, making the commute to work, drinking coffee, working at my standup desk, more coffee, calls, emails, Slack, meetings, more coffee, picking up my 2-yearold from daycare, eating the delicious dinner my husband has prepared for the family, doing homework and reading with the kids before their bedtime routines, and then it’s finally time to rest.

of issues our legal team gets to

address each day – it’s challenging

and rewarding. Right now, we’re

swamped with the effects of the

COVID-19 outbreak and how

that has impacted members’ and

associations’ business plans. We

are also focused on enhancing our

members’ compliance with the Fair

Housing Act and delivering useful

risk management guidance regarding

disaster preparedness, wire fraud,

texting and calling consumers, website

accessibility, independent contractor

classification, copyright infringement,

campaign finance compliance, board

governance, and more.

How has technology changed legal risks for Realtors ® ? Q3.

A. I appreciate the great diversity

enhanced the ability for our members

to deliver a superior consumer

experience. Technology makes it easier to do almost anything – including violating the law. So, keeping up-todate on laws and regulations that impact your business is the best way for members to avoid risk online and off. That’s what we’re here for!

What do you see as the biggest legal/legislative issue Realtor ® members across the country should be concerned about? Q4.

A. Technology has positively

for our members boils down to their value proposition. From class action lawyers to consumer advocates and even fellow brokers and agents, the value Realtors ® bring to consumers is not just being taken for granted, but

it’s being trivialized and degraded. NAR is currently defending two class action lawsuits alleging that our members are overpaid. We need members to take notice, talk with consumers about their role in the transaction, what services they provide, what they get paid and how, and why the MLS system benefits consumers. A great way to get started is to leverage all the communication assets available in our consumer awareness campaign at ThatsWhoWeR.com.

What are some of the legal risks you see for Realtors ® and NAR in the future? Q5.

A. The biggest issue right now

Bonus Question

A. From public health to the economy and politics, this coronavirus pandemic will have longterm implications for all individuals and businesses. NAR is committed to staying on top of the legal risks and advocating for favorable policies that will help our members be successful.

Is there anything else we should have asked? Q6.

What are some of the areas you and your legal staff work on? Q1. Q2.

A. I am also honored to serve as NAR’s Chief Member Experience Officer. In this role, I work with a superbly competent and dedicated team of individuals focused on engaging and empowering the Realtor ® community by delivering trusted knowledge, resources, and experiences that elevate members’ professionalism and success.