There is no denying that our world is becoming increasingly integrated. Smart home technology allows us to monitor and control our homes from wherever we are through our mobile phones or tablets. Even if we don’t have a fully integrated smart home, home security systems are installed in about fifteen percent of American households. Home security system providers offer video cameras as options for most systems being installed today. What impact might this technology have on real estate?
As a seller, you go through the checklist your real estate agent gave you to prepare your home for an open house or showing. Not mentioning common sense security and safety steps, you open curtains, turn on lights, tidy up, set your security alarm system, lock up and leave. You’ve given the security alarm code to your agent, so that’s taken care of. You’ve never given a second thought to the fact that your security camera in the living room is ready to record any activity that takes place there during the open house or showing. Is there any issue? Is this legal? Could you be liable?
On the flip side, you are the buyer coming to this seller’s home for a private showing with your agent. The agent accesses the lockbox, opens the door and disarms the security system alarm. You conduct your showing and are not aware that you are being monitored and recorded by the video camera in the living room. You love this home and displayed your great pleasure when discussing your thoughts with your agent in the living room before leaving to write a purchase offer. Your agent turns the security system back on, locks the door, replaces the key in the lockbox and you both depart.
In the scenarios described above, the seller did not purposely intend to record the buyer’s activities during the showing and may not have even thought to access the recorded video. What if the seller intended to record the buyer’s activities and discovered the buyer’s enthusiasm and used that fact to negotiate a much higher sale price? The buyer was not even aware of the video camera or the possibility of being recorded. If the buyer knew that a video camera was recording activities during the showing, would s/he have acted differently? What if the security system or other devices also included audio recording? It should be easy to see how sticky this situation could become in short order.
At this point, more questions have been raised than answers presented. The National Association of Realtors has prepared a state-by-state summary survey of the surveillance laws for the individual states. In New York, mechanically capturing and/or recording verbal conversations is unlawful without the consent of at least one of the individuals in the conversation. Security systems utilizing video surveillance must be installed in such a manner as to make the video device(s) clearly and immediately obvious; or a written notice must be conspicuously posted on the premises stating that a video surveillance system has been installed for security purposes.
If the three most important aspects of real estate are location, location, location; the three most important aspects in limiting liability in real estate are disclosure, disclosure, disclosure. Real estate agents need to address this subject with their clients. Sellers need to identify the presence of video cameras in their home, so this fact can be disclosed to buyers. Buyers should be informed of the potential for audio and video surveillance while viewing a home during an open house or private showing and conduct themselves accordingly. Awareness is the key to this issue and this issue is certain to become more prominent in the near future.