Updated on November 21, 2025

What Is Greenwashing in Real Estate Marketing?

Terms such as eco-friendly, sustainable, recyclable, and biodegradable are often used to market consumer goods. These labels are sometimes accompanied by the iconic recycling symbol or eye‑catching green packaging, leading consumers to believe they are making environmentally responsible choices.

However, many companies engage in greenwashing in real estate, a deceptive marketing practice where properties are portrayed as more environmentally friendly than they truly are. This form of greenwashing in real estate can mislead buyers, making it critical to understand California property disclosure laws to protect yourself from misinformation.

If you are buying or selling, consulting resources on real estate fraud prevention and environmental claims in property sales can help you identify and avoid greenwashing in real estate.

Key Takeaways

• Greenwashing in real estate misleads buyers with exaggerated or false eco-friendly claims.
• California disclosure laws require sellers to report material environmental facts.
• Common tactics include fake certifications, minor green features, and misleading visuals.
• Transfer Disclosure Statement (TDS) and Seller Property Questionnaire (SPQ) help verify claims.
• Buyers should cross-check sustainability marketing against legal disclosures to avoid fraud.

What Can Real Estate Sellers Learn from Keurig’s Greenwashing Case?

A recent example of greenwashing involving Keurig Dr. Pepper Inc. (Keurig) illustrates this risk. Keurig allegedly made inaccurate statements about the recyclability of its K-Cup single-use beverage pods. Although the pods could in fact be recycled, and Keurig even conducted testing to ensure that such a small product could be processed, Keurig failed to include one major flaw: two of the largest recycling companies in the United States did not intend to accept the pods for recycling.

This incomplete disclosure led the Securities and Exchange Commission (SEC) to charge Keurig, resulting in Keurig paying $1.5 million in civil penalties for misleading environmental claims. (SEC Charges Keurig with Making Inaccurate Statements Regarding Recyclability of K-Cup Beverage Pod, U.S. Securities and Exchange Commission, (September 10, 2024) Had Keurig placed a qualifier on the statement that, for example, the beverage pod “may not be recyclable in your area,” it may have avoided an accusation of greenwashing. 

This example underscores a key principle: Transparency in environmental claims is essential, whether you’re selling coffee or a California home.

How Does Greenwashing Mislead Buyers About a Property’s Sustainability?

While greenwashing continues to plague consumer products, it is important to recognize that these same practices can threaten real property. Just like consumer products, greenwashing occurs when a seller uses “green” terms to market a property, these claims can be misleading — and potentially actionable under California disclosure laws.

Here are some common tactics used in property greenwashing:

• Distraction Through Minor Features: Highlighting a small environmentally friendly feature to distract from a larger inefficiency in HVAC systems, such as promoting that the property has energy-efficient windows but failing to disclose that the rest of the building is not energy efficient; 
• Superficial Visual Sustainability: Displaying glossy photographs of a tranquil outdoor patio or atrium with green trees and colorful flowers — to imply sustainability, but the property’s energy consumption is harmful to the environment; 
• Irrelevant Claims: Making environmental claims that are already legally required or a standard practice by law, like making a claim that lead-based paint isn’t used (banned in residential properties since 1978), despite its nonuse being standard for over 45 years; and
• False or Misleading Certifications: Providing fake certifications of environmental efficiency, like a Leadership in Energy and Environmental Design (LEED) certificate without verifying their legitimacy. These certificates are provided to buildings that have met the U.S. Green Building Council’s (USGBC) high standards for sustainability, health, and efficiency.

These misrepresentations don’t just affect buyer trust—they can lead to legal consequences under California real estate law, particularly if they involve omissions or false claims in mandatory disclosure forms.

What Do California Property Disclosure Laws Say About Green Marketing Claims?

Not only are these and other similar actions unethical, but a seller’s misrepresentation of the property’s sustainability features or failure to disclose significant information that impacts the property’s “green” claims could lead to a fraud & non-disclosure lawsuit.

Under California Civil Code §1102 et seq., residential sellers must disclose:

• Known material defects
• Environmental hazards (e.g., asbestos, mold, lead-based paint)
• Zoning violations
• Easements and neighborhood nuisances

To help facilitate full disclosure, there are standard forms, “Transfer Disclosure Statement (TDS)” and “Seller Property Questionnaire (SPQ),” that the California legislature and the California Association of Realtors developed to guide sellers in making these important disclosures.

Although neither form specifically states “greenwashing,” a seller should still make it a point to provide the full picture of their environmentally efficient (or inefficient) property. This is more of an issue of the Seller affirmatively misrepresenting the “green” status of a property as opposed to a non-disclosure of a condition that may have an environmental impact.

To help clarify such matters, the Seller Property Questionnaire does ask the seller whether there have been “[an]y alterations, modifications, replacements, improvements, remodeling, or material repairs to the Property done for the purpose of energy or water efficiency improvement or renewable energy?” (Seller Property Questionnaire, Currently Item 6B.) As required, a seller should provide a full explanation to answer this question.

What About Commercial Real Estate?

It would also be a smart practice for buyers to not only inquire further about the “green” claims but to cross-reference this section against those claims. Although there is no standard form for commercial property, the duty of disclosure is still the same. 

Why It Matters:

Ultimately, transparency in real estate marketing benefits both the seller and buyer. Sellers should be encouraged to highlight their “green” properties, but also provide accurate statements. Buyers who are looking to reduce their environmental footprint should be diligent in confirming the validity of those statements. 

FAQs About Greenwashing in Real Estate

• Q1: What are some common examples of greenwashing in real estate?

  • A: Examples include exaggerating energy-efficient features, using misleading visuals, or providing fake sustainability certifications.

• Q2: Is greenwashing illegal in California real estate transactions?

  • A: While the term “greenwashing” isn’t used in the law, misrepresenting or failing to disclose material environmental facts can lead to legal liability under California real estate disclosure laws, including fraud and misrepresentation.

• Q3: Are sellers required to disclose eco-friendly upgrades or environmental modifications?

  • A:Yes, Sellers must disclose material facts especially if upgrades were made for energy or water efficiency, as asked in the Seller Property Questionnaire (Item 6B).

• Q4: What are the Transfer Disclosure Statement and the Seller Property Questionnaire?

  • A: These are required disclosure forms in California real estate transactions. They help ensure buyers are aware of any defects, upgrades, or features—especially those related to environmental performance.

• Q5: How can buyers avoid being misled by false sustainability claims?

  • Buyers should ask specific questions, verify all environmental or “green” claims, and compare marketing statements to what’s disclosed in official documents.

At Schorr Law, our Los Angeles real estate attorneys are highly experienced in handling non-disclosure and misrepresentation cases. These claims can involve blatant omissions, subtle concealments, affirmative misrepresentations, or negligent statements. If you suspect greenwashing or believe you were misled during a real estate transaction, call us today at (866) 718-4240 or contact us online for a confidential consultation.

Share your situation with our experienced team—we’ll help you determine whether you have a viable claim. This is what we do, every day.

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