Munro: Ideal solution would be single source of information about a property
Rules on the information that must be included in property listings are to be extended next month to cover issues such as restrictive covenants and flood risks, the senior manager of the National Trading Standards (NTS) estate and letting agency team has said.
James Munro said much of the information required under the extension to the rules would highlight “potential drawbacks” with a property which could potentially lead buyers to pull out of a transaction.
The first of a three-part process on providing material information upfront took effect last year and requires the inclusion on all listings of a property’s council tax band or rate and its price and tenure information.
Part B covers information which must be established for all properties, such as restrictive covenants, while part C covers additional material information that may or may not need to be established, depending on whether the property is affected by it, such as flood risk reports.
In a podcast hosted by Bold Legal Group founder Rob Hailstone, Mr Munro said parts B and C would be released together, and he anticipated this would take place “in October time”.
Emma Cooke, policy and information manager at NTS, said conveyancers as well as estate agents could potentially be jailed for breaking the rules.
She explained that NTS took “a variety of enforcement action”, ranging from advisory visits and warning letters to prosecutions, depending on the severity of the detriment suffered by consumers and how many there were.
In the case of a prosecution, the maximum penalties were an unlimited fine or two years in prison. “Anyone in the chain” who advised consumers could be sanctioned, Ms Cooke said. “It could be an estate agent, it could be a conveyancer, it could be a solicitor.”
However, Mr Munro said the “vast majority of complaints” about lack of material information ended up being dealt with by redress schemes, such as the Property Ombudsman, who could impose fines of up to £25,000 for serious offences.
He said the process of determining what was material information was “dynamic” and could include in the future electrical vehicle charging points.
The aim was to include “information which could affect the average consumer’s transactional decisions”.
The ideal solution would be a “single source” of information, pulled together “electronically and automatically” and displayed automatically.
Mr Hailstone said he was “all in favour of material information”, but there had been “a lot of resistance from the conveyancing community”, which “did not really see how they are going to get engaged in this and who is going to pay them”.
Mr Munro said it was “particularly incumbent” on estate agents as the first point of contact for sellers to give a “professional appraisal of how they see the property going through the process”.
When there were “a lot of issues that could cause problems down the line”, agents were under a duty to tell consumers that they needed to speak to a lawyer.
A digital conveyancing conference last week heard that the government should make full upfront information compulsory for it to work but this was unlikely to happen.
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