Calling and texting potential buyers and sellers in the real estate industry is quite common, especially for those attempting to ascertain whether a property owner is interested in selling.
With that said, a major question for those making real estate purchase calls (calls asking if a property owner is interested in selling his or her property) is whether those calls are subject to the Telephone Consumer Protection Act (TCPA).
Unfortunately, the answer is a bit more complicated than a simple ‘yes’ or ‘no.’
Below we dive into which parts of the TCPA potentially apply to real estate purchase calls and why. But first, we address the relevant parts of the TCPA.
Quick Overview: What is the TCPA?
For purposes of this discussion, the relevant subsections of the TCPA are B and C (47 U.S.C. §§ 227(b) and (c)).
Subsection B: Autodialed, Prerecorded & Artificial Voice Calls
Subsection B deals with autodialed, prerecorded, and artificial voice calls to cell phones and residential lines.
Specifically, Subsection B prohibits making non-emergency autodialed calls or artificial or prerecorded voice calls to cell phones without the called party’s prior express consent. If the call is a sales call, the called party’s prior express written consent is required. The TCPA’s applicable term for autodialer is “automatic telephone dialing system” (ATDS).
Subsection B also prohibits making non-emergency artificial or prerecorded voice calls to residential lines without the called party’s prior express consent. If the call constitutes a sales call, the called party’s prior express written consent is required.
Subsection C: Live-Agent Telephone Solicitations
Subsection C deals with rules concerning live-agent “telephone solicitations.” Those rules include:
- Call-time restrictions
- National Do Not Call Registry (NDNCR) rule
- Rules concerning company-specific do-not-call requests (internal DNC rule) for telephone solicitation calls (AKA sales calls)
Importantly, under the TCPA, a call constitutes a “telephone solicitation” if it is made for the purpose of encouraging the purchase or rental of, or investment in, property, goods, or services.
Such a call does not constitute a “telephone solicitation” if it is made (1) with the called party’s prior express invitation or permission or (2) subject to an applicable established business relationship with the called party.
Call-Time Restrictions
Under the call-time restriction rule, telephone solicitations can only be made to residential telephone subscribers between 8 AM and 9 PM (local time at the called party’s location).
National Do Not Call Registry (NDNCR)
Under the NDNCR rule, telephone solicitations cannot be made to residential telephone subscribers who have registered their residential telephone numbers on the NDNCR.
Ongoing Uncertainty for Private Right of Action for NDNCR Rule Violations
The TCPA was enacted in 1992. Notably, the NDNCR rule, which was enacted in 2003, was not enacted under the TCPA. Thus, it is an open question as to whether the NDNCR rule constitutes a Subsection C rule for which there is a private right of action.
Internal DNC Rule
Under the internal DNC rule, companies making calls to residential telephone subscribers for telemarketing purposes must honor consumers’ company-specific do-not-call requests within 10 business days and have a written policy for maintaining a list of consumers (and their telephone numbers) that have made such requests.
Do Real Estate Purchase Calls Fall Under the TCPA?
After learning about the TCPA, you likely still wonder whether Subsection B or C apply to real estate purchase calls. Due to different court opinions, currently the answer to that question is not a simple ‘yes’ or ‘no.’
To best answer that question, we begin with Subsection C.
How Subsection C May Apply to Real Estate Purchase Calls
There is a strong argument that real estate purchase calls are not “telephone solicitations” and thus Subsection C’s rules do not apply to them—as long as they don’t involve any transaction in which the caller will be selling something to the called party as part of the real estate purchase.
Back in 2005, the FCC opined that such calls do not constitute “telephone solicitations.” That opinion aligns with common sense. Clearly, on a real estate purchase call, including calls during which the caller offers to purchase the called party’s property, the caller is not encouraging the called party to purchase, rent, or invest in anything.
Instead, those calls involve the caller looking to purchase something from the called party, the exact inverse of what the TCPA’s definition of “telephone solicitation” contemplates. Since then, a number of federal courts have followed the FCC’s common sense opinion.
Examples of Real Court Cases
Two of the most recent decisions following the FCC’s opinion are from the United States District Court for the District of Arizona in Coffey v. Fast Easy Offer LLC and the United States District Court for the Eastern District of California in Aussieker v. Aghazadeh.
In Coffey, the District of Arizona held that calls and text messages seeking to solicit a called party to sell his or her home are not telephone solicitations, as the called party would be making money and not purchasing anything from the caller.
In Aussiker, the Eastern District of California held that a call offering to buy something from the called party is not a telephone solicitation because it is not a communication for the purpose of encouraging the called party’s purchase or rental of, or investment in, property, goods, or services.
So, Does Subsection C of the TCPA Apply to Real Estate Purchase Calls?
Given all of this, the answer to whether Subsection C applies to real estate purchase calls should be a simple ‘no.’ But plaintiffs’ attorneys are more than willing to argue the opposite, and have succeeded in cases where they could show that the caller’s transaction included services for which they were paid an ‘effective fee’ (such as items on closing costs that were paid to the buyer).
Thus, despite the strong argument as to Subsection C not applying to real estate purchase calls, if you make such calls, how you elect to navigate Subsection C’s rules really depends on the level of risk you are willing to stomach and how you structure your transactions.
How Subsection B Applies to Certain Real Estate Purchase Calls
Unlike with Subsection C’s rules, there is no question that it is possible for Subsection B’s rules to apply to real estate purchase calls—if they are made with Subsection B technology (an ATDS or prerecorded/artificial voice).
If you do, then you need to know whether your calls require the called party’s prior express written consent or just their prior express consent.
Essentially all non-emergency calls made with an ATDS (made to cell phones) or an artificial or prerecorded voice (made to cell phones or residential lines) require at least the called party’s prior express consent.
Thus, if you make a real estate purchase call using an ATDS or an artificial or prerecorded voice, you must ensure that you have each called party’s prior express consent. Subsection B does not apply to such calls if you don’t use an ATDS or an artificial or prerecorded voice.
If you do use an ATDS or an artificial or prerecorded voice to make real estate purchase calls, then you have to determine whether you make such calls for a telemarketing purpose. If you do, then you must have each called party’s prior express written consent.
Best Practices for Real Estate Investors
As discussed above, the TCPA’s applicable definitions of “telephone solicitation” and “telemarketing” are nearly identical. Thus, the same analysis used for determining the applicability of Subsection C’s rules to such calls is also used to determine whether each called party’s prior express written consent is needed for such calls or if only their prior express consent is required.
Therefore, if you use an ATDS or artificial or prerecorded voice to make real estate purchase calls, how you navigate Subsection B’s rules and the level of called-party consent required also depends on the level of risk you are comfortable taking on.
But the best way to navigate Subsection B’s rules is to avoid using an ATDS or artificial or prerecorded voice when making such calls. If you do that, Subsection B does not apply to your calls and you’ll only need to be concerned with Subsection C.
How to Reduce Compliance Risk with Readymode
As discussed above, whether Subsection C applies to real estate purchase calls should be a simple no, but is currently an open question. To reduce risk, Readymode’s outbound calling platform helps sales teams prioritize compliance as part of their workflow.
If you seek to reduce the potential risk of violating Subsection C when making purchase calls, Readymode’s integrations and compliance features include scrubbing against the NDNCR and internal DNC list management.
To avoid Subsection B risk, simply avoid using an ATDS or artificial or prerecorded voice to make such calls. Notably, Readymode can’t be fairly characterized as an autodialer under the TCPA.
With fully blended inbound and outbound calling channels, multimode dialing options, and built-in CRM, Readymode is a trusted solution for real estate businesses.
Interested in learning more?
This article is only offered for informational purposes; it is not legal advice. Please consult a qualified attorney for your specific compliance needs.
Joe Bowser
Joe Bowser is a partner at Roth Jackson. He has been practicing communications and marketing law for two decades. He advises and defends calling and SMS platform providers (like Readymode), carriers/VoIP providers, and heavy users of those services in their wide range of compliance needs. In his spare time, you can find him taking his boys to their sports, getting in a workout of his own, or catching an Arsenal match.
