According to the National Trading Standards (NTS), the new data fields will start to appear during the next several weeks as part of the first phase of a project that it is instituting with industry members. The NTS said a complete list of the Part A material information was available on its website.
NTS, an organisation which aims to protect consumers and safeguard businesses, said it was working with property portals and other industry groups to streamline how estate and letting agents provide basic essential material information.
The project has three phases in total and was developed in conjunction with industry queries about the information that must be disclosed when marketing a property.
Part A covers information considered material for all properties. Parts B and C are still in the works but are expected to cover information such as flood risk, restrictive covenants and other factors that could affect specific properties.
If an agent then leaves details blank on tenure, price or council tax, consumers would be alerted to the omission with advice on how to track down those details themselves.
NTS wants all material information to be mandatory on property listings once all three phases of the project are complete. At that stage, agents would need to include all the required information before a property was listed on a portal.
Potential benefits
Proponents of the scheme say the benefits would include a reduction in unnecessary enquiries, speedier sales and fewer transactions that fell through.
Simon Jones, director of consumer protection for the Competition and Markets Authority (CMA), said it was important that people were “fully aware of the annual costs of owning a home before they buy”. He added that the CMA’s leasehold investigation had found that providing “clearer up-front information” was needed when properties were sold.
He said the NTS announcement was “a positive step in that direction”.
James Munro, senior manager of the NTS estate and letting agency team, agreed, saying it “represents an important milestone in the journey to improve material information on property listings” and that these changes would “prompt all players in the property market to do things a bit differently”.
He added: “Vendors and agents may find that bringing conveyancers on board at the outset helps ensure all information is available for marketing, and issues with things like restrictive covenants or boundaries can be addressed earlier. For consumers, a better understanding of why certain information such as a property’s tenure is important will enable them to make informed decisions when they embark on a property search.”
Munro said the project “will make it easier for estate and letting agents to meet their legal obligations and we look forward to supporting them as they get to grips with a new way of working”.
David Hollingworth, associate director of communications for L&C Mortgages, said: “These changes are clearly for the benefit of consumers and aimed at improving the transparency about a property for sale or to let. That should help customers have a clearer picture at an earlier stage which will hopefully help borrowers flag any potential issues, such as tenure or eventually restrictive covenants, at an earlier stage.
“That will hopefully aid a broker in picking up any potential quirks and honing their search more effectively.”
Possibility of increased costs
However, whereas the NTS surveyed more than 300 agents last year found that 91 percent of respondents thought that a defined list of basic material information would improve clarity for the industry, others were less enthusiastic.
Matthew Poole, director of Poole Family Financial, said he didn’t see the proposed changes affecting brokers as much as they would impact estate agents, adding more work to their remits.
“Estate agents are the ones who will need to find out the information around flood risk, restrictive covenants and other factors and this could mean increased costs for selling properties,” he said.
He added it would be interesting to see if it would lead to “swifter sales” as most conveyancers would do a thorough job with their enquiries, and they would still do depending on the information they have upfront.
But in the end, Poole said: “I don’t believe having this information upfront would necessarily help a buyer to make a decision on whether to purchase a property or not. This is why buyers employ a solicitor to ensure everything is in order before committing to the purchase.”
Government action and further support
The NTS said the UK government has signaled that related legislation might follow.
Neil O’Brien, parliamentary under secretary of state for the Department for Levelling Up, Housing and Communities, said: “A key part of levelling up is creating a fair and just housing system that works for everyone, and this includes supporting more first-time buyers to move onto the housing ladder.
“Far too often when buying and selling properties, deals fall through, costing young people thousands of pounds in wasted expense. By providing all the necessary information up front, this can be avoided, and it will make the process of buying a first home much easier and more cost-effective.”
David Cox, Rightmove’s legal and compliance director, said that more than 80 per cent of its property listings included tenure, which is up from 70 per cent last year when it started encouraging more agents to add this information as part of the NTS’ initiative.
He added: “We hope that having an industry-agreed official list of material information will better help agents know exactly all the info they need to add when they’re advertising properties.”
Rebecca Marsh, ombudsman at The Property Ombudsman, added that this initiative was a “positive start” along a path that would see “full disclosure” of material information.
She noted: “By providing more vital information at the point a consumer first becomes aware of a property, the less likely transactions are to fail, leading to higher consumer trust and confidence in the sector.”
Mairead Carroll, senior specialist of land and property standards at the Royal Institution of Chartered Surveyors (RICS), said: “RICS is fully supportive of finding ways to improve the homebuying process for consumers. Providing more upfront and transparent data between market participants across the whole buying, selling and conveyancing process, coupled with a home survey, means buyers are able to make more informed offers, reducing the time taken for a sale to complete and avoiding unnecessary costs for all involved.
“There may be concerns over storing this much data but by using RICS standards, property data can be captured for a range of due diligence purposes, whether that’s to check the flood risk of a property, energy performance risks and opportunities, or whether to find out if there is a right of access to consider.”
