Advertising your rental property as “eco-friendly,” “sustainable,” or “green” sounds like a great way to attract tenants and justify higher rent. However, if your claims don’t actually hold up, it can turn into a legal nightmare. Tenants pay close attention to what their landlords promise, and misleading claims can generate a lawsuit. Your perception of sustainability might differ greatly from a tenant’s perception, so consider the following points before using environmentally friendly descriptions in your listings.
Sustainability claims carry legal weight
You might see using words like “green” and “sustainable” as harmless marketing, but these words are considered promises under the law. Once you advertise something in a listing, tenants can argue that they relied on it when making the decision to rent. If that feature or amenity doesn’t exist, they have the grounds for a lawsuit.
Marketing language matters. When you advertise a property as eco-friendly, for example, tenants might expect lower utility bills, better insulation, or specific energy-saving features. If the property doesn’t meet their expectations, they can claim they were misled by greenwashing.
Avoid using vague descriptors like “eco-friendly,” “green,” and “sustainable” without also providing detailed specifics. These words are too broad and that makes them risky for use in advertising. If you’re going to use these words, make sure you list exactly what features or amenities they describe. If you can’t list specifics, don’t use vague words.
If you own multifamily property, false claims put you at risk for a class action lawsuit. For instance, if multiple tenants feel misled by claims that the building is “energy efficient” they might come together to file a lawsuit against you.
Know what counts as eco-friendly according to the law
Ultimately, the law doesn’t define eco-friendly, and that’s exactly why using this term can get you into trouble. It’s all subject to interpretation and the expectations you create for your tenants. If you’re going to use the term, you need to explain and prove what you mean. For example, it’s better to list tangible features, like the presence of Energy Star appliances, solar panels, upgraded insulation, and LEED certification. These specifics can support your eco-friendly claims.
However, be especially cautious about making performance claims, like saying tenants will save money on utilities. Even if your property would save most people money on their heating and cooling costs, you can’t predict how every tenant will use the HVAC system and you can’t guarantee the power company’s rates are lower compared to where the tenant previously lived. A tenant might use less energy in your property but end up with a higher bill because the rates are higher, the property is larger, or they use more power.
Also, consider that energy companies constantly raise rates and most customers don’t know how to read their bills to calculate rate changes. One rate hike or inconsistent/excessive use is all it takes to make a tenant feel deceived by claims of lower utility bills. In that case, when an eco-friendly claim is tied to a specific promise that doesn’t materialize (like lower utility bills), a tenant can argue misrepresentation in court. If they paid higher rent expecting lower energy bills, they can seek compensation for that.
How to market “green” features without risk
You don’t need to avoid discussing sustainability completely, but you do need to be smart about how you advertise your properties. Your best move is to be specific. Rather than saying your property is eco-friendly, explain that it includes Energy Star appliances and low-flow toilets and sinks.
Avoid stating outcomes you can’t control. For example, don’t make any promises about saving money on utility bills. Some landlords include phrases like “Energy-efficient features may help reduce utility costs, depending on usage,” but talk to a lawyer before adding that to your marketing messages.
Document everything
Courts want evidence. If you end up in court over questionable sustainability claims, you’ll be required to prove even basic facts. For example, say you installed an Energy Star washer and dryer, but your tenant claims they’re basic appliances. If you walk into court without proof (photos of the washer and dryer or installation records), it will be your word against your tenant’s and you might lose.
Document everything. Save all receipts, service and installation records, and even the manufacturer’s specifications. Most importantly, keep copies of your rental listings and ads in case you need to prove exactly what you advertised.
Be cautious about green marketing
Courts take misleading advertising seriously even when it’s unintentional. Calling a rental property eco-friendly can be a powerful selling point but it becomes a liability when it’s not backed up by specifics.
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