Leaving properties in portals - sharp practice or an offence?

Recently there have been reports of agents leaving properties live on portals even though they are “sold subject to contract”, with some saying it is “morally wrong and sharp practice”. However, according to JMW, it is actually far more than this.

Related topics:  Property
Property Reporter
6th April 2022
Question 901

It is almost certainly a criminal offence. The Consumer Protection from Unfair Trading Regulations 2008 (the “CPRs”) regulates estate and letting agents, just as much as other businesses trading to consumers. In fact, it is likely to be an offence under several different parts of the regulations.

David Smith, Partner at JMW Solicitors, says: “First, it is important to realise that the CPRs restrict any practice which might lead to a consumer making a transactional decision. That includes merely deciding to call an agent to book a viewing. So it is no defence here to say that as soon as someone calls the agent they will find out that the property is no longer available and will have lost nothing. The effort by the consumer in calling to have their time wasted is enough to justify a prosecution.

"In fact, agents know this very well and they certainly do not allow a call to end with the simple assertion that the property is no longer available without also trying to make clear that there are other properties an enquirer is interested in.

“Looking at the regulations we can see that regulation 8 makes clear that it is an offence to engage in a commercial practice “which contravenes the requirements of professional diligence” and which is “likely to materially distort the economic behaviour of the average consumer”.

"As I set out above this practice is entirely intended to distort the behaviour of a consumer and its description by industry figures as “sharp practice” makes clear that it is unlikely to be considered to be professionally diligent.

“Regulation 9 makes misleading actions an offence. These are defined in regulation 5 and include any advert that “contains false information and is therefore untruthful” in relation to a range of matters. One of these matters is specifically described as being the “availability of the product”. Clearly, suggesting in an advert a property is available to view and purchase when it is in fact not is likely to be a misleading action.

“Finally, regulation 12 makes it an offence to engage in any commercial practice described specifically in Schedule 1 of the CPRs. These actions are always considered unfair and were set out in the original EU Directive which gave rise to the CPRs.

“Advertising a property as being available but then telling callers that they cannot view it because it is SSTC is a classic example of bait and switch.

David concludes: “I hope that this is not something that is happening. The CPRs are created for a reason and are abused by some of the very worst traders in the property sector and the marketplace generally. This is the nicer end of some of the appalling scams perpetrated during lockdown where tenants were told they had to pay holding deposits before viewing properties which turned out to be total fakes. They are legally speaking on the same continuum and, morally speaking, not so very far removed either.”

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