False Advertising In The MLS, Or Anywhere, Is Illegal

It is illegal to advertise false information, but check carefully as there can be other reasons for the discrepancy between details on the listing and the actual house. (sirtravelalot/Shutterstock)

Dear Monty: I told the selling agent that the home on the MLS (multiple listing service) is falsely listing the square footage. They are advertising 1,650 square feet of livable space, but I checked with the township, and they state the house is 1,446 square feet. I put in an offer based on the actual square footage. They have other offers, but those buyers do not know the advertising is false. The listing agent wants to hold my bid until the other offers come in. Is this illegal or unethical? Also, is the false advertisement on the MLS illegal?

Monty’s Answer: There are several conceivable possibilities regarding the square footage discrepancy that may explain why there are 204 square feet unaccounted for in the township records:

No. 1: The homeowner finished a 14-by-15-foot room in the basement and did not obtain a permit.

No. 2: The township would not record the improvement if they required no permit.

No. 3: The township may have a building permit on file but failed to update the assessment card.

No. 4: You may have checked with a person unqualified to provide the answer in the town office.

Verify Information Carefully

You may have asked all the right questions, and the home may be 1,446 square feet. The right person in the township office is the town assessor. That individual or an experienced person in the assessor’s office can find the correct answer. Consider checking again because if someone at the town office made an error and there are 1,650 square feet of living space, you are bargaining at a significant disadvantage. It is likely 1,650 square feet if a finished room is in the basement.

On the other hand, some real estate agents have been known to be very creative (it’s never a lie, it’s always a mistake) in stating square footage. In fairness, it could be a mistake. If three people measure a home for square footage, it is not unusual to see three different sizes.

According to Nolo, it is illegal to advertise false information. Whether in an ad, data sheet or even verbally, it is also unethical. For a home that size, over 200 square feet would be a significant misrepresentation. It also may be difficult to prove it was deliberate.

In some municipalities where an owner got no permit where it was required, it can be difficult for both the buyer and seller. Some municipalities will require an after-the-fact permit, which can be expensive. Still, there may need to be dismantling of the work to ensure the installation meets code requirements. At that point, it may mean that the buyer, now the owner, must litigate to force the seller to pay. Litigation can be complicated when the seller has moved across the country, left no forwarding address or does not have the money to pay.

Delay Presenting Offers

The listing agent is representing the seller. The seller may have told the listing agent that they would not look at offers until they were all in hand. The agent may have suggested that tactic to the seller. In either case, it is not illegal or unethical for a seller to seek the best offer by waiting. Offers can be withdrawn before presentation. Sometimes, the seller may have done better by not waiting.

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