Consumer Protection Regulations
CPR replaced the Property Misdescriptions Act, now known as Consumer Protection From Unfair Trading Regulations 2008.
It exists to provide transparency to the buyer and to ensure accurate information is given to the buyer in order to allow them to make decisions. It heavily dilutes the heavily relied upon premise of Caveat Emptor (let the buyer beware), with onus firmly placed with the estate agent to provide correct information.
Non-compliance can lead to prosecution by Trading Standards.
We have to follow due diligence and confirm that facts given by clients are accurate. Our duty of care extends to both buyers and tenants as well as clients. A way of performing due diligence is to request that when taking on a property the client completes a Property Information Questionnaire. In the case of Sales this would include confirmation of lease information, disclosure of known structural issues, planning issues, neighbour disputes etc.
It is important to have an ‘audit trail’. This means we make notes on Jupix of all events/conversations with buyer and client. If a dispute should ever arise we will need to produce evidence supporting our actions.
When considering complaints, the view point of the ‘average consumer’ is considered and decisions based on protecting the buyer from unfairness is applied.
‘Unfair’ practice can be broken down into 5 key points.
- Misleading actions – Where false or misleading information is provided.
- Misleading ommisions – Hiding, or failing to provide, material information
- Aggressive practices – Exerting undue pressure
- Failing to show prof. diligence – Not acting in good faith. Not supplying an expected standard of skill and care.
- Engaging in a banned practice – Claiming to be part of an organisation (eg. ARLA NAEA), when you are not.
CPR protects against a company providing misleading information which leads to a purchaser/applicant making transactional decisions. A transactional decision can be interpreted as deciding to:
View a property
Making an offer
Instruct a conveyancer
Use a mortgage advisor
Commission a survey
Ask yourself, if you were the recipient of mis-information or were not provided with information, would it affect your decision to proceed? Information such as:
Failed planning application
Withholding from an interested party that a property is ‘under offer’.
Obliged under due diligence to question and seek out information.
Will need to obtain and retain information.
Being professional and skilful in disclosing information
Be mindful of obtaining information. Check, record, update, record, consult, record.
- Take care in gathering & presenting information being used to advertise services & market property.
- Have systems & safeguards to ensure marketing information is accurate, balanced & does not omit material facts.
- When on notice of an issue take reasonable steps to establish facts for ourselves – question, check, consult.
- When new information becomes known act promptly to correct or update marketing and to pass on information.
- When we don’t know if we exhaust reasonable steps then be open & transparent about any gaps in our knowledge.
- Not to pressurise to put in an offer, raise a price, skip a survey, take any services (solicitor, mortgage, surveyor) or finalise a transaction.