There could be a sharp rise in both criminal and civil cases against agents who breach their duties of disclosure.
The warning has come from Chris Hamer, of The Property Ombudsman service, in a special interim report on the Consumer Protection from Unfair Trading Regulations.
Hamer said: “Events over the past 12 months have seen the CPRs starting to be enforced by Trading Standards.
“While the origins of CPRs are based on European Directives that are not specifically aimed at the property sector, the forthcoming repeal of the Property Misdescriptions Act 1991, expected later this year, will potentially see Trading Standards increase activity in taking civil and/or criminal actions against property agents that fail to comply with the Regulations.
“The application of CPRs changes the way all property agents market properties and provide information to consumers.”
The CPRs make it incumbent on agents to disclose everything they should reasonably be expected to know, and also what they become aware of during marketing of the property, and which could affect a consumer’s decision as to whether to buy or rent.
While the CPRs are not new – they have been in force since May 2008 – they are set to become more important, probably this autumn, when the Property Misdecriptions Act is scrapped.
The Interim Report includes case studies, commentary and guidance to assist agents in meeting their obligations under the CPRs.
As well as duties of disclosure, the CPRs make it illegal to misdescribe a property, use aggressive practices such as forcing a prospective buyer to use an associated service, or claim to be a member of a professional body when the agent is not.
CPR-related case studies included in the report include instances where agents were caught out by not including information as to planning permissions, title, access and neighbours.
In one case, a property was sold with off-street parking. However, when the buyers moved in they found that because the kerb was not dropped, legally they could not access their hard-standing.
In another case, tenants objected after they found themselves living next door to students who played loud music late at night. The tenants successfully argued that the agent had misrepresented the neighbouring property and were awarded £500.
The interim report also gives an update of TPO’s workload between January and the end of April, showing a slight increase from 235 cases in the same period last year to 264 about sales, and a much larger rise about lettings from 279 to 391.
Initial complaints were also up from 1,332 in the first four months of last year to 1,626 this year.
https://www.tpos.co.uk/quarterly_report.htm
Comments
Scott, I think you are agreeing with me that you or any other portal could not be prosecuted by the OFT for any matter relating property descriptions either uploaded by an agent or FSBO.
However i do not think you took advice from agents i think you were blackmailed by them. "Quite simply we do not want to alienate the UK estate agency market"
I am always amused that so many UK EA's seem so afraid of FSBO competition, as you say there European cousins embrace it
Perhaps a more dominant portal could take FSBO if they wanted, but as you say it is a small percentage of the market so why bother. If they did I doubt the FSBO market would grow that much anyway which leads me back to why are the EA's so afraid of it, so much so in fact they bully you into not accepting revenue from FSBO??????
@Neil - "So checking details on adverts has nothing to do with why Finders and Sellers will not accept FSBO, come on Scott what is the real reason?2
I didn't say it had northing to do with it, in fact I think I said the complete opposite and I quote,
"CPR's are one of the main reasons we at Finders and Sellers, removed the FSBO feature from our portal in the first place, because with 400,000 listings on our site, it is physically impossible to check them all for misrepresentation. "
And if you read it again you will also see I said "one of the reasons". I have said before quite openly that the advice we have received from dozens and dozens of Estate Agents in the UK over the last 18 months also prompted us to remove the FSBO feature.
Quite simply we do not want to alienate the UK estate agency market in order to include FSBO which makes up a very small percentage of residential sales in the UK.
This however is not the case in the rest of Europe where FSBO and agency listings sit happily together on the same portals. In fact in our Spanish office in particular we have noted quite a number of estate agents who will gladly add listings to their websites (for an advertising fee) but have nothing to do with the sale. They simply advertise a property along with their own listings as a FSBO and forward enquiries to the owner.
That's an extra 50 - 100 euros a month for sticking a picture (taken by the owners) and a description (written by the owners) on your website.
@Happy Chappy - "Scott, It is my understanding, You are not in anyway acting as an agent. Under the regulations as a provider of portal service you are not responsible for the property description of FSBO or agents."
Half right. My understanding of the regulations and they are a very boring read so I may have lost concentration half way through, is that we are not an agent because we do not insist on any contractual obligation from the agents who list with us or the clients who use those agents. We have no contact with an agents clients and we hold none of their information in our data base. We do not buy or sell property, we receive no commission and no fees from either the listing agents or their clients, therefore we are not an estate agent.
However because we provide an ancillary service related to the sale of property ie. marketing albeit free, we are still governed by some of the CPR's and OFT guidelines.
And that is why In an attempt to ensure our free service is not abused by misrepresentation, to the best of our ability, we decided to remove the FSBO feature and stick with agents who are answerable to a governing body. Of course there will always be those cowboys who abuse the system,
But we also have a very clearly laid out set of terms and conditions written for us by our firm of solicitors in line with the OFT guidelines and which explains that all property details, articles, opinions etc have not been indepently verified etc etc.
We are working very hard to provide a user friendly and save environment for site visitors and agents alike.
As I am sure you are all aware, the battle against online fraud and those who will do any thing to make a quick buck, is on going.
@Neil
Ask Alan Sugar.
So checking details on adverts has nothing to do with why Finders and Sellers will not accept FSBO, come on Scott what is the real reason?
Wow, is agency so nadir it’s cool to openly insult the customer, way to start the show fella’s. The irony alone is worth the price of admission but I figure long-term exposure to our industry claims another to cynicism, just wish we’d handle it better.
Sorry buddy but before you lay there all glowing and reaching for a Marlborough lite - the customer is always right. The ideal shouldn’t need explaining so hats off to Scott but I’m guessing that even if presented between the breasts of a supermodel, you still wouldn’t accept it. Lets not cop out on buyer beware either, dude this is another that shouldn’t need explaining, beam me up Scotty…
Scott, It is my understanding, You are not in anyway acting as an agent. Under the regulations as a provider of portal service you are not responsible for the property description of FSBO or agents.
“Blah, blah, blah, sycophant schmooze the TPO!”
That is all well and good Trevor and I have no problem with the redress service offered by Mr Hamer and his firm. I have a problem that he/the company allows Agents, the public, the media, MP's and civil servants to believe that he is the official, government appointed Property Ombudsman when it is not entirely clear whether or not that is the case. Perhaps I am the only person in the entire country who does not know Mr Hamer is the official Property ombudsman, I suspect I am not the only one who is confused
If government have officially sanctioned Mr Hamer as a government appointed official , great, carry on doing the job in hand . If however that isn't the case and TPO is no more sanctioned than any other redress scheme provider then it ought to be very clear that whenever the firm Mr Hamer heads issues press releases he is referred to appropriately as MD /CEO/ Whatever and not as “The Ombudsman”
Reference to "Chris and Bill" indicates a chumminess which is inappropriate to the role of an impartial, official, post. Chris and Bill might be very nice fellows doing a sterling job but that should not stop anyone confused by their position asking for clarification and requesting that if "Chris and Bill" are not officially appointed then it ought to be clear in all communications with whosoever they lobby and in all press communication. A failure to do so implies independence in place of commercial interest.
Transparency should not be obscured by uncertainty.
Chris and Bill hats off to you. You do an unenviable job for the better of the industry.
we need the OFT to better regulate those who offer agency services and fail to register. go to any property networking meet that encourages property investment and how to find BMV, sandwich deals, quick sale, lease options - and although some are fair there will be others looking for a quick dime at others costs.
Many of these fortune hunters at the cost of consumers often don't register with a redress and worse fail to know its there.
Also interesting to see the rental case that led to a £500 reward back. The CPRs were pitched as mainly geared towards sales.
Please would someone please clarify what Christopher Hamer is.
Companies house regulations say;
Ombudsman - This word is normally associated with an official organisation appointed by government to investigate complaints, generally on behalf of individuals such as consumers or taxpayers, against private or public institutions. These organisations also have access rights to sensitive personal information.
You will also need to obtain a letter or email of non-objection from a government or a relevant body.
Does TPO have such a letter or email of non- objection? If it does should it?
There are multiple redress schemes available to Estate Agents and Property Managers is it right for the boss of one supplier to receive the benefit of a misleading badge of office.
@Kevin - "The customer is not always right Scott, they are usually right. Anyone thinking the customer is always right is not running a business but a charity."
Of course they aren't, I know it, you know it and what's more, they know it. That is not what I said.
I am talking about psychological attitude in a customer service environment. The way you think about your customers is reflected in the way you treat them, you can't do anything about it. It is basic psychology, the way you think is the way you act.
In order to get their custom, keep their custom and avoid them blaming you at the first opportunity, yes you need to ensure you dot all the i's and cross the t's but you also need to make them like and respect you.
I agree we are all human and all fallible but, why give them an excuse in the first place by presenting yourself as someone who thinks they are morons.
Some interesting comments by the majority. Dealing with other human beings will always be challenging, especially when buying and selling property. The process is a foreign language to most of them, unlike those on here, who earn living at it.
kevin and truth - I would go and find a job that you enjoy. One that doesn't involve the public, because clearly agency isn't for you! If you fancy fleecing people, try sheep farming. Fancy coming on to an open forum and making derogatory comments about the very people that pay your wages. Priceless!
The customer is not always right Scott, they are usually right. Anyone thinking the customer is always right is not running a business but a charity
I had a Fee Disclusure agreement and a signed tenancy agreement both endorsed by the tenants and guarantor. They complained att he end of the tenancy that fees weren't disclosed.
When challenged - they claimed that they hadn't read either propely as 'they were too busy' even though all charged were headline on the front page with explanations.
What can you say?
@Kevin said "When people universally assume all estate agents are of a stereotype I see no reason I cannot adopt a similar stance."
Well Kevin I have been working with a lot of estate agents over the last 18 months and as a result can say that the stereotype image is truly undeserved, however I think you have missed the point. The fact is you have proved there is no smoke without fire, what I actually said was,
"If those comments are reflected in your customer service, which I have absolutely no doubt they are....... then no wonder estate agents have such a bad reputation".
To answer that comment with - "Given you have no idea who I am, or work for, I doubt very much that my comments will have any impact at all on my work life."
Is like saying even if the morons I am talking about are reading this, they don't know who I am so why should I care. That attitude just fuels the stereotype.
And as for "Especially given the vast majority of the 826 guests will be fellow agents and not clients anyhow"
Well you could be right, but I'm not an agent, the other four people in my office who read your comments aren't agents, and I believe it was an agent who said on this very forum last week,
"Scott Creasey is under the misapprehension that everybody on here is and estate agent when they are not, the majority are service providers."
"I believe in buyer beware" and I Kevin concur, but I am also a great believer in if you want to build a great business reputation which brings in tons of referrals and repeat custom, then you also need to embrace the saying, "the customer is always right."
All I am saying is if you approach customer service with the attitude,
"90% of the public I meet via my work are morons. And 100% of them are looking for someone to blame when they themselves mess up."
And who do you think they will blame first when something goes wrong?
@scott & @quagmire
You should ask an A&E nurse what they think of people on a Friday & Saturday night
Or a fireman called to a flat where the smoke detector has had its battery removed to stop it going off when the tenants burn their toast
Or an IT consultant (have you turned it off & back on again), teacher, social worker, etc, etc...
In general, most people in most professions will have a similar view of the slightly less than intelligent members of the general public that they have to deal with.
That, also, is human nature./
Deep breath ladies & germs...
@truth & @kevin have a bit of a point, but the wording is poor.
All human beings have their own best interests at heart - it is a fundamental fact of human nature.
That generally translates to selfish, egotistical and narcissistic behaviour - not for the odd one or two, but for the majority.
In rare cases you come across nice selfless people on a daily basis and the world ticks by.
The problem is that property transactions combine several elements that together bring out the worst in people.
The problem is (as with all things) it is hard to remember all the easy, simple, pleasant (even bland) experiences, whereas it is all to easy to remember the things that are horrid, unpleasant and difficult.
So, someone who does not think properly before they type could come up with the figures 90% and 100%.
The truth, by definition, is that 50% of people, owners, buyers, landlords, tenants, solicitors and what have you are nicer than average.
And the other 50% are nastier.
You will remember to worst of them and completely forget the rest.
Therefore in difficult situations (like property sales) agents (who have to deal with people at their worst) tend to remember the really nasty horrible people.
Certainly, I have been an agent for 21 years now and I am still surprised at how thoroughly petty people can be for no reason other than "Because"...
On my darker days even I, the perpetual optimist, have been know to say "GOD I HATE PEOPLE"
When people universally assume all estate agents are of a stereotype I see no reason I cannot adopt a similar stance. Any estate agent will know the frustration of having a buyer, tenant or landlord ask/make a ridiculous question/request.
Given you have no idea who I am, or work for, I doubt very much that my comments will have any impact at all on my work life. Especially given the vast majority of the 826 guests will be fellow agents and not clients anyhow. I meet many sensible, committed people in what I do, but yes, I do also meet some idiots I am afraid.
I believe in buyer beware. If I buy a car that turns out to have outstanding finance on it by the previous owner and it is taken off of me I have no-one to blame but myself. I should have done the sensible checks. Given the article subject matter, although I appreciate an estate agent cannot mislead, if the buyer buys the property having inspected themselves, surveyed, and then had their solicitor acting on matters, and they still complete only to find a problem later, tough. That's my view and I'm sticking to it.
Couldn't agree more Scot. I think these guys have shown who the real morons are.
@truth @kevin,
Interesting perception of those who pay your wages, especially on an open forum which, as I write this, has 826 guests on line, many of whom will be the morons you are referring to.
If those comments are reflected in your customer service, which I have absolutely no doubt they are, because it is impossible to be sincere if that is what you believe, then no wonder estate agents have such a bad reputation amongst the morons you meet on a daily basis.
As for this report, these changing CPR's are one of the main reasons we at Finders and Sellers, removed the FSBO feature from our portal in the first place, because with 400,000 listings on our site, it is physically impossible to check them all for misrepresentation.
We hope we can trust the agents who list with us to do the right thing. No matter how much you think the CPR's are there to make life difficult for you, and no matter how much you believe that 100% of the morons you call your clients are looking for someone to blame, remember you are also a consumer.
Let's hope you don't join the ranks of the morons next time you buy something that doesn't do what is says on the tin eh!
@truth
Agreed. 90% of the public I meet via my work are morons. And 100% of them are looking for someone to blame when they themselves mess up.
Fact: The public's view of Estate Agents is nothing.........compared to the Estate Agents view of the Public.