LEAD GENERATION WEBSITES COULD LEAD REALTORS® TO RUN AFOUL OF THE CODE OF ETHICS, MINNESOTA LAW

There are several popular websites for consumers starting their home search, and many of them also offer lead services for real estate agents. While these websites can be a tool used by both listing and buyer’s agents in gaining and serving customers and clients, they are often national websites that work both REALTORS® and non-member licensees. REALTORS® using these websites need to remember that they are bound by the National Association of REALTORS® Code of Ethics and by the state law in the state they are licensed in and practice.

It has come to the attention of Minnesota REALTORS® that one or more popular lead generation websites utilized by real estate agents sends emails to listing agents when a consumer has shown interest in the listing agent’s property. Those communications, at least in some instances, contain a link that would enable the listing agent to directly contact the interested buyer, even through that buyer may be represented already. The emails may state that a buyer’s agent paying for the lead generation services was given an inquiry on the listing agent’s listing, and that the buyer’s agent will follow up with the listing agent if that “client” would like to schedule a showing of the listing. The emails may go on to state that if the listing agent needs to contact that client of the buyer’s agent directly to assist with scheduling a showing appointment, or possibly for other reasons, the listing agent can click a link to use other contact information provided in the email to contact that client directly. The lead generation website may or may not then remind the listing agent to follow the rules of his or her brokerage, MLS, association rules and regulations, and laws.

The last sentence is important. REALTORS® need to remember that Article 16 of the Code of Ethics states that they “shall not engage in any practice or take any action inconsistent with exclusive representation or exclusive brokerage relationship agreements that other REALTORS® have with their clients.” Article 16 specifically prohibits a REALTOR® from making direct contact with the client of another REALTOR®. Further, Minn. Stat & 82.81, subd. 9 specifically prohibits “negotiat[ing] the purchase, lease, or exchange of real property knowing that the buyer or lessee has executed a written contract granting exclusive representation or assistance for the same service of purchase, lease or exchange of the real property with another real estate broker. “If a lead generation website states that the inquiry is from a “client” of another agent, the listing agent should assume that there is a written representation agreement, and that client should not be contacted using the “click here” link or other contact information provided to the listing agent to gain direct access to the client. Thus, if Minnesota REALTORS® receive an email similar to that which is described above, they should not make contact with the client.

Anne Kealing
Anne V. Kealing, JD

Associate Legal Counsel

Find more real estate industry information in the

MN REALTORS® March REsource Magazine

The Minnesota REALTORS® is the largest professional trade association in the state with more than 17,000 members who are active in all aspects of the real estate industry.

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