The government has taken the view that the Consumer Protection from Unfair Trading Regulations 2008 and the Business Protection from Misleading Marketing Regulations 2008 provide a better mechanism for regulating this area of business.
While PMA made it an offence to make false or misleading statements in the course of an estate agency business or a property development when offering properties for sale, in terms of the 2008 regulations agents should not:
(a) Give false or misleading information to consumers
(b) Hide or fail to provide material information to consumers
(c) Exert undue pressure on consumers
(d) Engage in one of the "banned practices"
Agents are also required to act with the standard of care and skill that is in accordance with honest market practice and in good faith.
It is a requirement not to hide or fail to provide information which is the main difference between the PMA and 2008 regulations.
Consumers are defined as individuals who are acting for purposes outside their business. They could be actual or prospective clients, prospective buyers or viewers. The information we as agents must provide will be affected by the type of property being sold and the likely buyer. If for example an agent is selling a retirement property and the consumer is a pensioner, then that consumer may be considered to be "vulnerable" and therefore requires more information than the average consumer.
What does this mean for us? It is to be hoped that the majority of agents are complying with the 2008 regulations already but we need to look at our current practices and make sure that we are not hiding or failing to provide material information to consumers. The English and Scottish markets are quite different.
A significant amount of the information that an estate agent in England would be expected to disclose is already included in the Home Report. If for instance it is unlikely that a mortgage could be obtained over a certain type of property this will probably be stated in the Home Report. We need to consider the contents of the Property Questionnaire. Is it reasonable to answer "Don't know" to all questions? If there is a title issue should this be drawn to the attention of a potential purchaser? And if so, at what stage?
If we are providing information about the level of factoring charges or school catchment areas we must be sure that information is accurate. It might be more appropriate to point the consumer to the relevant local authority website for certain information.