Drones: Real Estate Tool and Liability

By
Education & Training with Adhi Schools, LLC

Drones (also known as Unmanned Aircraft Systems (UAS), the term used by the FAA) are being increasingly used for commercial purposes. Real estate professionals may want to use these drones to improve their listings with aerial view pictures or videos of a property (a pretty cool practice we've been seeing). However, it is currently not legal to operate a UAS for commercial purposes without a Section 333 Waiver from the FAA. Here is what you need to know about these waivers and potentially using drones for your business.

 

  1. A pilot’s license is necessary for a Section 333. A broker can’t just buy a drone and fill out a form to get permission for commercial use.
  2. You are allowed to hire someone with a Section 333 to operate a UAS for commercial purposes for you. If you really want aerial pictures of your listing, but do not want to go through the process of getting a pilot’s license, just hire someone who already has permission from the FAA.
  3. You can take steps to protect yourself. UAS operators can get insurance for their aircraft to limit liability. If you choose to contract a UAS company/operator, ask for proof of insurance. The National Association of Realtors also points out that you can also request that the operator “indemnify you against any actions, suits, damages, losses, costs and expenses” from the operation of the UAS. Basically, just make sure you are absolved from liability in any contract you sign. If the operator crashes the drone into someone’s house (or worse, into someone), you don’t want to be on the hook in a lawsuit.

 

Penalties

 

Nearly all drones must be registered now, whether they will be used for recreational or commercial purposes. There are already steep fines in place if a drone being used for recreational use is not registered. 

 

The repercussions become much more serious when commercial usage is involved. Consider this case, where a company called SkyPan was fined $1.9M by the FAA for flying unregistered drones without permission for commercial use in an unsafe manner. The precedent is implying that the penalties will vary (unauthorized UAS usage in big cities with crowded air traffic will result in bigger fines than flying in a small suburb), but the FAA is serious about enforcement. Some in the commercial drone industry expect fines to typically fall in the $1,000-$10,000 range, which is significantly less than $1.9M, but still a lot of money. The FAA website asks citizens to report crashed drones or suspicious drones to local law enforcement and there is no reason to believe threats of enforcing these laws are empty.  

 

While it may seem like an unlikely event (and there are plenty of websites alleging that the FAA can’t/won’t do much of anything), real estate professionals would be wise to avoid risking these types of penalties. Hire a company that can legally fly UAS for commercial purposes. If you don’t know what you're doing and fly illegally you could; 1) hurt someone 2) damage someone’s property and 3) get in serious trouble with the FAA. It isn’t worth it. 

 

New rules have been proposed and will likely come into effect soon. Follow the link if you intend on operating a UAS and want to see the potential changes coming. 

 

Your opinions on the topic are welcomed! Have you seen people using drones in real estate? Would you consider it? Do aerial views of a property help sell it? 

Posted by

Cody Carmen

Comments (4)

Les & Sarah Oswald
Realty One Group - Eastvale, CA
Broker, Realtor and Investor

Wow, that is a steep fine from FAA. Perhaps, they are trying to get their message across that drones must be registered. Your blog will help many avoid these unnecessary fines.

May 27, 2016 07:39 AM
Cody Carmen

Thanks for commenting! I agree, that's definitely a lot of money. Hopefully no one with good intentions finds themselves subject to a fine just because they were unaware they were breaking the law, just trying to spread the word here!

May 27, 2016 07:44 AM
Larry Johnston
Broker, Friends & Neighbors Real Estate and Elkhart County Subdivisions, LLC - Elkhart, IN
Broker,Friends & Neighbors Real Estate, Elkhart,IN

Hi Cody Carmen , I  have a drone, but haven't had time to play with it.  Eventually the FAA will get things in order for us to use them professionally, so in the meantime, it will stay in my yard.

May 27, 2016 11:48 AM
Cody Carmen

Larry, I definitely think that's the best plan. Ideally the FAA will differentiate between using drones for commercial purposes in a suburb versus a major city/crowded airspace. Not sure it will happen, but in the meantime there are people available to do the job legally for anyone who thinks it would be beneficial to their real estate business. 

May 31, 2016 02:03 AM
John Herman
Property Up Inc. - Barrington, IL
Licensed Illinois Managing Broker- Property up Inc

Well information about using drone as real estate tool. Good job!

May 27, 2016 03:41 PM
Cody Carmen

Thank you John!

May 31, 2016 02:01 AM
Patricia Kennedy
RLAH Real Estate - Washington, DC
Home in the Capital

Recently, somebody's drone wound up on the White House lawn, and there was some reconing!  The idea of big bugs flying around with cameras is a little creepy!  

Jun 09, 2016 07:15 AM
Cody Carmen

Pretty sure that guy is receiving jail time too. I do think drones can serve numerous commercial purposes in safe, responsible hands.  

Jun 09, 2016 07:19 AM