It s possible residential real estate may be an unintended target of Do-Not-Call legislation, but trade organizations like the Real Estate Board of New York are advising members to abide by the regulations.
After nearly two weeks of court-ordered delays, the Federal Trade Commission began taking complaints earlier this month from people who have placed phone numbers on the national Do-Not-Call registry.
The plan went in to effect 11 days later than the FTC had hoped to begin enforcing its anti-telemarketing registry because it was blocked by a series of federal court decisions.
Under the regulations, telemarketers and other sellers now risk a fine of up to $11,000 for calling a number on the list. Additionally, sellers must update their registry every three months and synchronize their calls with that list.
Since business-to-business phone calls are exempt, the new rules have not been a concern for cold calling in commercial real estate. But residential real estate, and unsolicited calls to FSBOs, are being affected by the new regulations, said Michael Slattery, senior vice president for research at REBNY.
Slattery said Do-Not-Call regulations appear to apply to for-sale-by-owner calls because “the fact that someone is selling a house, it may not mean that they want further services.” Even if the phone number is publicly available, Slattery said, it still could be covered under the new regulations.
Calls may be exempt, however, if an agent is calling on behalf of a specific buyer. “If you are calling because you represent a potential buyer, it would probably be an acceptable phone call,” he said.
Neil Binder, principal of Bellmarc, thinks the law might not even apply to residential real estate at all in terms of FSBOs, but is waiting for clarification from the courts.
“I m not sure our industry is covered under the regulations,” he said. “The intent was to prevent unsolicited cold-calling. But if you are putting out your property for sale, the mere fact that you put out an ad creates a distinction.” Slattery said other REBNY members have also pointed out they think the regulations are aimed more at “frivolous calls” for magazine subscriptions and similar solicitations.
Arguments on the constitutionality of the regulations are scheduled in federal court on Nov. 10. Although a final legal resolution may not come for some time, the FTC has indicated it will aggressively carry out enforcement.
Slattery said many agents expressed concern about mistakenly calling someone on the list and running afoul of the new rules.
“There has been a lot of concern because people don t want to be in noncompliance,” he said. “There are pretty hefty fines for repeat violations.”
But he said the fines are not geared to “inadvertent calls, but rather to those that flaunt the list. As long as you demonstrate a procedure for checking against the list, you should be OK,” he said.
In downloading the registry from the FTC s Web site, data for five area codes is available for free, and beyond that there is a $25 charge per area code.
Calls exempt from the registry for a specified period of time include situations where a company has already established a business relationship with the person they are calling. “If you have a prior business relationship, that gives you 18 months leeway where you can continue calling,” said Slattery. If a consumer makes an inquiry or submits an application to the company, the company can call for three months.
As far as calling people who have signed up for the list but have not yet appeared in registry, Slattery said the FTC has been “good about telling people there is a wait.”
In addition to potential fines, what affect the new regulations will have on the bottom line of companies remains unclear.
“I don t have a sense that it will affect the level of business activity the industry is engaged in,” said Slattery. “But firms will have to implement a set of controls.”
Binder said Bellmarc pursues FSBO business, but he couldn t estimate how much revenue it brings in.