Final answer:
False statements of facts in real estate, such as listing income property with a 12% return but not including all expenses, can be misleading. Potential buyers should carefully review all relevant financial information to make an informed decision.
Step-by-step explanation:
False statements of facts can be misleading, especially in the context of real estate. In this case, the license listed income property showing a 12% return, but didn't include all expenses. This is a common tactic used to attract potential buyers by making the property seem more profitable than it actually is.
For example, let's say a property is advertised as having a 12% return on investment. However, the seller conveniently omits expenses like property taxes, insurance, maintenance costs, and vacancy rates. When these expenses are factored in, the actual return on investment may be significantly lower or even negative.
It's important for potential buyers or investors to carefully review all relevant financial information, including both income and expenses, to make an informed decision. This can help avoid falling for false statements and ensure a more accurate assessment of the property's financial viability.