The IRS puts loopholes in the code in order to induce a particular behavior.

What is fraud by inducement? 

I've lived in a one bedroom apartment that was just under 700 sq ft ... all one one floor.It has a reasonable sized living room and bedroom and plenty of closet space.Since the two story has to have a staircase, that has to deduct about 25 sq ft one two floors. 675 - 50 = 625 and that is at least "claustrophia inducing."

And to get more granular, if you break a window it's not like you can replace it with the white vinyl windows you likely have in your house that you can order through 50 suppliers or your local Home Depot.Anyway, it sounds like an ulcer-inducing adventure! 

Ended up being my inducer motor.    

Part of sellers claims are FRAUD BY INDUCEMENT, victimizing the elderly, violation of 475.43, etc.

What you're suggesting is akin to appraisal fraud and inducing the seller to sell which is possible if a short sale would have otherwise been completely avoided and unnecessary - but in this market it's unlikely, as a good many homes with mortgages are underwater.

We were talking about the legalities of certain types of advertisements and inducements and incentives used by realtors in the industry.

I wasn't suggesting any particular solution, but there are a few active investors who say they get many seller leads from property managers with the inducement being that they will not change management.

Regardless of who comes out with panic induced literature & media regarding the housing market / economy; there will be those that make it out and the majority that will be caught in it.