If you're part owner on a listing, do you need to disclose your ownership interest on the MLS and through your marketing?
Question: I am a part owner of a property that I am listing. Must I include a statement that discloses my ownership interest in the property in the MLS and print ads or on the For Sale sign?
Answer: Both the Code of Ethics and most state license laws establish requirements for disclosure of personal interest when buying or selling. The Code addresses personal interest disclosure in Article 4: REALTORS® shall not acquire an interest in or buy or present offers from themselves, any member of their immediate families, their firms or any member thereof . . . without making their true position known to the owner or the owner’s agent or broker.
The article goes on to say that when REALTORS® are selling property that they own, or in which they have any interest, they shall reveal their ownership or interest in writing to the buyer or the buyer’s representative. Standard of Practice 4-1 requires that this disclosure be in writing and be provided by REALTORS® prior to the signing of any contract.
One good way to make your position known so buyers will be alerted to it prior to signing a contract is to write a disclosure of ownership interest in the MLS public remarks for the property. State license laws may also require disclosure in or along with the sales contract.
As far as whether the disclosure must appear in advertising materials, there is no requirement in the Code. But Standard of Practice 12-5 requires that the name of the firm appear in such advertising in a reasonable and readily apparent manner.
If the property is available for rent, your obligation to disclose is covered under Standard of Practice 12-6 .
Your state license law may have different requirements. For example, in Missouri, when advertising unlisted owned property for sale or lease, licensees must use one of the phrases By owner-agent, By owner-salesperson, or By owner-broker in all advertising, print or electronic. To be sure you are in compliance, follow the Code and check your state license law.