So, the National Trading Standards Estate and Letting Agency Team (NTSELAT) has now announced its latest guidance on improving the disclosure of upfront information in property listings.
The aim is to assist buyers, agents and ultimately conveyancers in making informed decisions on property purchase by way of greater transparency and to make clear what ‘material information’ means in the context of the Consumer Protection Regulations and what must not be omitted.
Part A, as it’s termed, was laid out in February last year and includes disclosure of tenure (leasehold/freehold), lease length and service charges, council tax banding and asking price (no more POA).
Part B and C were set out on Thursday 30th November and include for Part B, property type, property construction (brick, tile etc), rooms and measurements, utilities (including broadband speed and mobile phone signal strength) and parking.
In Part C, any flood risk, cladding issues, planning consents, accessibility adaptations, covenants and restrictions (TPOs, listed status and so on).
So, property buying is falling in line with just about every other major asset purchase process. After all, would you buy a business without looking at the books first, or an investment product without reading the small print before committing? No, so is it so hard for us to understand why committing to a home purchase should require transparency and disclosure early on?
There are two ways of looking at this latest guidance that the property industry must consider.
Some agents will respond pessimistically and see the regs as a chore. It’s more admin, more work and a ‘pain in the rse’. I suspect that this might be the view of a significant minority and I understand why agents feel put upon of late as they contend with an array of new compulsions across seller AML, buyer AML, redress membership, Renter Reform legislation and so on.
But wait, might the Trading Standards stipulations be an opportunity for UK estate agents? In fact, might there be several opportunities to benefit from?
If I may, I’ll set out my thoughts on why this seeming burden on the industry should be seen as a ‘glass half full’ moment.
The more information that is gathered at the beginning of a transaction i.e at the listing, the quicker the sale will complete and the faster the agent gets paid. Since the pandemic this period has now risen to 115 days on average yet conveyancers Thomas Legal spent a year piloting upfront information and found that the time between SSTC and exchange reduced by as much as 53 days.
Not only does this mean that agents receive their commission cheques two months sooner – aiding cash flow significantly at a critical time for the sector – but it also results in fall-through rates reducing by as much as 60%. I’ll leave you to work out how much more you would bank each year if six out of ten of your abortive sales didn’t collapse.
These are the fundamentals of an improved buying and selling process via the provision of better upfront information not to mention sellers and clients that end up feeling less stressed, happier and more appreciative of their agent.
But the other opportunity that may not yet be so obvious is that by gathering and publishing upfront information as a pack, you have a shot at a financial margin. If the industry were to charge a fee for their time and expertise in gathering this data, especially if done by a third-party, then why not charge sellers a small fee for that?
Why absorb the cost? There is absolutely no imperative for you to do so and I’d argue that sellers that have ‘skin in the game’ by investing their money in the transaction early on, are far more likely to be serious and motivated. Don’t you agree?
Now no doubt the wise owls in the comments section below will tell us why upfront information is a problematic endeavour and a waste of time – a chore, a pain, more damned admin, and so on.
My suggestion though is that before we all run to find the negatives in progress, we look at the rather obvious positives too.
Gemma Young is co-founder of Moverly
