What Is Puffing in Real Estate? How to Spot It in a Listing

I want to start off by emphasizing the unfortunate fact that you can’t always believe what you read. This statement rings true as well for MLS listings data transmitted and found on sites like Zillow and Realtor.com.

Real estate puffing is illegal and can include MLS listing inaccuracies that may have been advertised with the intent to mislead would be buyers, leading to closing delays and failures while imposing a risk for potential lawsuits against real estate agents and sellers.

What Is Puffing In Real Estate Advertising

Real estate puffing comes in all shapes and sizes. It can range from a subjective exaggeration of a property’s features to outright false advertising or misrepresentation. An example of this might be a real estate agent stating a home is the most desirable in the neighborhood to the extreme of intentionally entering false information into the MLS listing or other advertising media.

What Is MLS?

MLS is the acronym for Multiple Listing Service. Licensed real estate professionals can pay for membership to their local board of real estate for MLS access. Access enables members to input and share property listing data with other real estate agent members which in turn share the information with their clients. When an MLS agent member enters property data, it becomes a legal advertisement.

MLS services offer the most comprehensive and privileged information available to it’s members only. Through private MLS, real estate brokers and agents can view property listing data in real-time without delay. Other private particulars include compensation offerings, property access and showing details as well as other information that is not privy to the public. MLS data accuracy is crucial for all parties relying upon its information.

How Puffing In Real Estate Can Show Up On Listing Sites Like Zillow and Realtor.com

Property listing websites like Realtor.com and Zillow have an IDX (internet data exchange) partnership agreement with numerous MLS’s nationwide. Recent data shows there are over 500 MLS systems in the U.S.

IDX is the combined database of numerous individual MLS’s across the U.S. It allows real estate brokers and agents to participate by “opting in” in order to share their listings online across multiple websites via the exchange agreement. Note that while the majority of listings appear via the IDX, not all listings do, should the real estate brokerage or agent choose not to participate.

Real Estate Agents Are Responsible For Listing Data Accuracy

We are finally getting to the meat and potatoes of this article! By understanding the forging and how the data is transmitted to various online property listing websites like Zillow and Realtor.com, we now have a clear picture.

Every property listing you view including specific descriptions and details have been either directly or indirectly entered by the licensed real estate agent or agent assistant. Either way, the licensed agent and supervising broker are the responsible parties for data accuracy. If real estate puffing occurred in the MLS listing, it will show up as well on the third party websites like Zillow or Realtor.com. 

Note that this is not the case for individual FSBO’s (For Sale By Owners) when there is no listing brokerage or agent. FSBO sellers are still bound by law to be truthful and accurate when advertising their own property for sale.

Buyer Beware of Real Estate Puffing In MLS Listings

This is a sore subject and a bit personal to me. Especially when it comes to unsuspecting buyers, first time buyers, the inexperienced or the elderly getting duped. I have always felt a sense of needing to breakout into superhero mode and to the rescue. In my thirty-seven years of real estate business, unfortunately I think I can say I’ve heard and seen it all. One of my biggest pet-peeves are when I’ve encountered real estate puffing; fraud and misleading advertising.

What Is Puffing In Real Estate VS. Errors

Errors

An error can include misinformation that is unintentional. This could include a wrong listed price by a mere typo during entry. An example would be a property being listed for $500,000 could erroneously be entered as $50,000 by leaving out a “0” or $5,000,000 by adding an extra “0”. Yikes what a spread. Another type of error is the misunderstanding on the part of the agent.

For example an agent might consider a 3/4 bath as 1 full bathroom. Let’s say the agent decides to list the bathroom as 1 full bath after reviewing the tax assessor’s records, however neglects to count the actual fixtures that confirms that there is no bathtub. For whatever reason, assessor records can often be incorrect either from the time the home was built or a possible remodel.

Puffing

Sales puffing or misrepresentation can include knowingly and willfully listing and advertising inaccuracies. Such inaccuracies can make the property appear more desirable. For example listing a 2 bedroom home as a 4 bedroom. The motivation is to spark engagement, attract a larger potential buyer pool and higher selling price.

Sadly I recently encountered a broker who is also a chair member of a local MLS committee, that puffed up the advertising of her own listing as a 4 bedroom home when it was legally a 2 bedroom. The discrepancy was confirmed with the building department. Two of the so called bedrooms were also located in the basement having no egress windows.

Common Real Estate Puffing Or Errors to Look For and How to Verify Accuracy

Type of Construction:

Often times a manufactured home listing will indicate “single family residence” rather than “manufactured” in order to puff up the desirability. Manufactured and Modular housing typically are less desirable, take longer to sell and bring a lower price. Verify the type of construction with the local building department, builder information and permits to confirm the type of construction, whether site built or manufactured. If manufactured or modular, verify that it is attached to an approved permanent foundation system through permits, an appraisal and title policy endorsements.

Square Footage of Home:

Puffing the square footage of a home is often found in listing data. It should only include the permitted living areas that are heated. The permitted living area is above grade and should not include crawl space, attic, garage, porches or patios even if enclosed or converted without permits. Basements can also be living area if finished, approved and permitted as such. Compare the listing with the county assessor’s office as well as the local building department to establish accuracy. Just because a seller has modified the structure does not make it legal or permitted.

Did you know that there is really no such thing as being “grandfathered” in Los Angeles county? Non-permitted, non-conforming, additions and modifications can come with stiff violation fees and teardown notices. Non-conforming uses may not allow rebuilding of the structure in the event of destruction or fire.

Garage:

A garage although is not living area should still be constructed with permits and be attached to a permanent foundation making it immovable. Verify permits with the local building department. There should be an appropriate overhead, swinging or sliding door to accommodate and store vehicles. Puffing could involve calling a portable shed a garage.

Bedroom Count:

Bedrooms should be legally permitted and include egress windows and a permanent closet. Puffing includes calling a den, office, garage conversion or other rooms that do not qualify as a bedroom, a “bedroom”. Confirm bedroom permits with the local building department and cross reference with the county assessor. Sometimes the assessor can have wrong information which can lead to an over assessment of property taxes.

Did you know that some jurisdictions have a “bedroom” tax? If you find that you only have 2 bedrooms, but being assessed for 3, you might want to resolve this discrepancy. Or tax records may show your home being substantially bigger than it actually is. It’s common in tract subdivisions where there are several models that were proposed for different lots, bedroom options versus dens and bonus rooms, the records can become messy and need sorting out.

Bathroom Count:

Bathroom counts are commonly calculated incorrectly. Assessor records will often note a mere quarter bath as 1 “bathroom”. Use this data to cross reference with the building department as well as a visual account. Note that a full bathroom includes four fixtures (tub, shower, sink and toilet). 1 fixture type equals 1/4 bath, 2 fixtures equal 1/2 bath, 3 fixtures equal 3/4 bath and 4 fixtures equal 1 full bath. A double vanity with 2 sinks will still only count as 1/4. Nice try!

Age of Home:

The actual age of the home should be validated through tax assessor and building department records. Homes having new additions cannot legally be considered new or a more recent age. The original age supersedes if any part of the original structure still remains.

Heating & Cooling:

Sometimes listing data will state central heat and air conditioning when in fact the home has no air, evaporative cooling and some other type of heating such as wall heat. Verify visually as well as through a licensed home inspection company. Central heat will have a furnace and ducting throughout the living area to each room. Central refrigerated air conditioning will have a condenser with ducting to each room.

Public Utilities:

This can also result in very important discrepancy. Listing agents have sometimes either puffed-up the property having public services or mistakenly assumed a property is connected to electric, public sewer, has public water and natural gas. Then it can turn out to have no electric meter, a private septic system, well water and delivered propane. Ask your real estate agent to confirm the utilities and services with the seller’s past utility bills and service providers. Verify with all local utility providers that they have and will still service the property.

Watch My Video What Is Puffing In Real Estate Advertising And MLS Or Read Transcript Below

I want to say kudos to this agent. I am super impressed. Okay, I have seen so many listings of houses with basements where agents call rooms down in the basement area bedrooms when they are not. So willy nilly a lot of these agents just and I’m not trying to bag on agents.

Okay, there’s a lot of good agents. But be on the lookout for some of these listings that will falsely say it’s a four bedroom or it’s a six bedroom,

my darn battery is low or it’s a 20 bedroom. I don’t know. Whatever suits their fancy that day. Okay? So don’t fall for it. Make sure you go to the local building department. Find out how many legal bedrooms the house really has because you can’t just even rent out a bedroom when it’s not legally a bedroom.

The liability is insane. Don’t even chance it. Okay? It needs egress windows in case of a fire so you can get your butt out.

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