THINKING ABOUT RUNNING A
CONTEST OR GIVEAWAY?

What Pennsylvania Real Estate Licensees Need to
Know: Contests, giveaways, and prizes can be great
marketing tools—but Pennsylvania real estate licensees
must follow specific rules when using them in
connection with the marketing or sale of real estate.

 

FIRST: MAKE SURE IT'S NOT AN ILLEGAL LOTTERY

Under Pennsylvania law, an activity may constitute illegal gambling when all three of
these elements are present:

 

1. CONSIDERATION - The consumer gives up something of value.
2. PRIZE - The consumer has the opportunity to win something of value.
3. CHANCE -The winner is selected randomly or by chance.

 

If all three are present, STOP. For-profit businesses generally are not eligible to conduct small games of chance. Your promotion should be reviewed with your broker and/or legal counsel before proceeding.

 

Example:
“Close a transaction with me, and you'll be entered to win a $500 gift card.”
Those words don’t clearly specify that the agent must be representing the seller at closing to be paid, which would be a condition they’d need to include. Or maybe the agent intends to offer this only to the first five listings they take, but that’s not listed as a limitation on the ad.  

 

YOUR ADVERTISEMENT MUST INCLUDE:
If your promotion complies with applicable gambling laws, PA Real Estate Commission
Regulation §35.306 requires advertisements involving lotteries, contests, prizes,
certificates, gifts or free lots to disclose:

    ✓ A clear description of the prize or gift
    ✓ All prerequisites or conditions required to receive or win it
    ✓ Any limits on the number of prizes or gifts available
    ✓ The fair market value of each prize or gift
    ✓ The odds of winning or receiving each prize or gift

PRINT ADVERTISING HAS AN EXTRA REQUIREMENT

The odds of winning must appear immediately adjacent to the prize description and in
the same size type. The fair market value must also appear in the same size type as the
prize description.

 

DON'T FORGET THE RECORDKEEPING

Licensees must maintain records documenting:
   The number and description of prizes or gifts awarded
   The name and address of every recipient
   The name and address of each person who responded to the promotion but did not
   receive a prize

 

Failure to follow the advertising or recordkeeping requirements may be considered deceptive conduct by the PA State Real Estate Commission.

 

BEFORE YOU LAUNCH...

Talk to your Broker.

 

Contest and giveaway rules involve both Pennsylvania gambling laws and real estate licensing regulations. Before advertising or launching a promotion, obtain approval from your broker and consult legal counsel when appropriate. When in doubt, ask before you advertise.

This information is provided for general educational purposes and is not legal advice. Refer to 49 Pa. Code §35.306 and applicable Pennsylvania law for complete requirements.

 

           BROKER APPROVAL REQUIRED BEFORE LAUNCH