Legal Question in Real Estate Law in Iowa

I am guessing you are referring to an advertisement or a report from a Multiple Listing Service. I am not aware of anything "illegal" about it. It may violate local MLS rules if it was listed with the local real estate board, and there may be an argument that it should be disclosed on the seller disclosure form. It may not be appropriate to include it in an appraisal, but you would need to verify that with a licensed appraiser.