Tips for Landlords: How to Adhere to Truth in Advertising Laws
The Federal Trade Commission (FTC) Act (also known as the Federal Truth in Advertising Law) directs all advertisers, including landlords, to meet specific requirements in all advertisements. Here are the conditions of the Act:
Deception: All advertisement must be truthful, fair, and free of misleading misrepresentations. Claims must be supported with solid proof. The Commission’s Deception Policy Statement describes deception as a misleading feature of the ad that convinces a customer to purchase or use the product or service.
Fairness: The FTC describes an unfair advertisement as an ad that causes harm that overrides any beneficial features that appeal to consumers.
Supporting evidence: If a product or service is being advertised that deals with health or safety, documented scientific evidence must support the claims.
Specific products and services: Federal truth-in-advertising laws include specific regulations for certain products (for example, alcoholic beverages, automobiles, clothing, consumer credit, and real estate). For rental housing, the FTC mandates that advertisements must follow the requirements provided in the Fair Housing Act.
Accurately describing the rental units
Regardless of where and how you choose to advertise, make sure your advertisements accurately describe the rental property. Here are some specific suggestions for producing accurate ads:
Use photos of actual rental units in their current condition. Avoid using photos that feature a model apartment, outfitted with upscale furnishings and decorating, if the model doesn’t represent what you’re really offering.
If you include the rent amount or range, make sure the dollar amounts accurately represent what you customarily charge residents.
Indicate any up-front fees, such as application fee required.
Stick to the facts, such as the overall square footage of units, number of rooms, and whether the units are furnished.
Avoid expressing value judgments with words such as quiet, convenient, luxurious, and exceptional, because other people may have different ideas of what those words mean.
Be careful not to make any implied claims that could mislead someone; for example, including a photo of someone carrying a tennis racket when your property has no tennis court.
Misleading advertising hurts you in two ways:
Exposes you to possible claims of false advertising. If you’re found guilty of false advertising, the FTC may issue a cease-and-desist order to stop running the ad and fine you for every day a future ad violates truth-in-advertising laws. Courts may also award damages to consumers for any harm caused.
Wastes a lot of your time when interested parties show up to check out the rental units, are disappointed, and leave.
Disclosing any important policies
Indicate any rental policies that are likely to turn away certain prospects to dissuade people who are unqualified or unlikely to be interested in renting from you. (Just make sure the reason you’re turning away these prospects doesn’t constitute illegal discrimination.) Here are a few policies a landlord may want to include in advertisements:
Credit check required
Think twice about establishing a no-pet policy. According to a recent renter survey conducted by Apartments.com, a leading Internet apartment listing service, 75 percent of renters are pet owners. Do you really want to exclude 75 percent of your market? In addition, if you do decide to have a no-pets policy, be sure to make exceptions for service animals.
Presenting rents and amenities accurately
Prospective renters need to know what their rental payment includes. If residents are responsible for paying their own utilities and you charge extra for additional services, be sure to mention those charges in your advertising. Here are a few examples:
Utilities (many landlords separately meter utilities and pass the costs directly to the resident)
Water and sewer
Consider using an absence of a fee as a selling point in your advertising. For example, you may advertise all utilities included or pets welcome at no extra charge or free Wi-Fi!
Avoiding bait-and-switch advertising
Bait-and-switch advertising misleads consumers into thinking that something is much better than it really is. The most common bait-and-switch tactic in the residential rental business is to advertise a spacious unit along with the price of one of the smaller units.
To avoid technically committing the bait-and-switch, some landlords include in tiny print just before the big, bold low price the words Starting at. Well, that may help you avoid any trouble with the FTC, but it’s still misleading and defeats your purpose of turning away anyone who’s probably not interested or qualified in the units you’re trying to lease.