Window to the Law: “Coming Soon” Listings Best Practices
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Window to the Law: “Coming Soon” Listings Best Practices


Hi everyone, today we’re discussing “coming
soon” listings, the differences between legitimate and improper coming soon listings,
and best practice tips for how you can use them in your business. A “coming soon” listing is a listed or
unlisted property that is not available for showing or sale until a later date. “Coming soon” can be a legitimate advertising
technique. They allow the owners more time to complete
repairs, pack, or otherwise ready the property for showing or sale. A legitimate “coming soon” complies with
state law, MLS rules, and NAR’s Code of Ethics. On the other hand, improper coming soon listings
violate state law, MLS rules, and NAR’s Code of Ethics because they are used to circumvent
the MLS, to market the property to a select group of people, or to ensure a buyer uses
the listing broker for the transaction. Our best practice tips will help you avoid
improper coming soon listings. But first, let’s talk about what makes them
improper. Well, they violate state licensing laws and
NAR’s Code of Ethics in a number of ways. For example, state law and the Code both require
real estate professionals to act in the best interest of their clients, but improper coming
soon listings serve the listing broker’s interest ahead of the client’s interest. State law and the Code also both require truth
in advertising, while improper coming soon listings are misleading and inaccurate. Improper coming soon listings could also violate
your MLS’s rules. MLSs facilitate real estate transactions as
a consolidated source of accurate property information and as a private offer of cooperation
and compensation. They function at their best when information
is complete. Improper “coming soon” listings compromise
that accuracy and undermine cooperation amongst real estate professionals. That’s why many MLSs have strict rules to
ensure proper use of coming soon. As coming soon listings gain popularity, real
estate commissions are taking notice and offering guidance on how to use them without breaking
state law. Most recently, the Idaho Real Estate Commission
issued Guidance #8. The document recognizes that some coming soon
listings are legitimate while others are “nefarious”, and the determination is fact specific. The Idaho Real Estate Commission emphasizes
that marketing a property to only a limited pool of potential buyers for the purpose of,
for example, pocketing more of the sales commission, violates state law because the professional
is not acting in the client’s best interest. The Nebraska Real Estate Commission’s guidance
document No. 40 lists four criteria for permissible “coming soon” advertising based on Nebraska’s
advertising law. (1) the advertising broker must have an active
listing agreement in place; (2) the advertising must be done in the name in which the broker
does business and under the broker’s supervision; (3) the advertising must be done with the
property owner’s, or his or her authorized agent’s, knowledge and written consent;
and (4) the listing must in fact be “coming soon” and not currently being shown or marketed
to a limited group. So, don’t risk lawsuits by dissatisfied
clients or disciplinary action by your real estate commission or MLS due to your use of
“coming soon”. Instead, follow these best practice tips to
properly and effectively use coming soon listings. First, always confirm that your advertising
is legal under state licensing laws and regulations. Check with your state’s real estate commission
for guidance on the issue. Second, consult your MLS about any rules or
requirements for coming soon listings. Third, identify a compelling reason for why
a “coming soon” listing is in your client’s best interest, explain the limitations and
potential pit falls of coming soon to your clients, and document their consent to use
a coming soon listing in writing. Fourth, always have a signed representation
agreement with your client And finally, make sure that the “coming
soon” restriction is applied equally to all potential buyers. These best practices will help protect you,
your clients, and your fellow real estate professionals. If you have any questions, please feel free
to email me. Thanks for watching this month’s episode
of Window to the Law.

2 Comments

  • Peter Dolci Jr

    I would like to know if any rules are broken when there is a double listing on the same property, different mls numbers, two different prices and yet they both expire at the same time? There has to be a rule that was broken.

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