PROPERTY JOURNAL

Updated guidance seeks to clarify material information

Clear, consistent provision of material information will not only help agents fulfil their legal obligations but enable consumers to buy or let property with greater confidence and efficiency

Author:

  • Emma Cooke

22 March 2024

Estate agent window displaying freehold and leasehold property adverts

Following nearly three years' collaboration between National Trading Standards (NTS) Estate and Letting Agency Team (NTSELAT) and property sector representatives, NTS has published updated guidance on what constitutes material information in property listings.

The guidance aims to offer clarity and consistency for all stakeholders, including consumers, and help reduce property transaction times and fall-throughs. It also helps agents meet their legal responsibilities under The Consumer Protection from Unfair Trading Regulations 2008 (CPRs).

A breach of the CPRs is a criminal offence that can lead to prosecution, with potential penalties including an unlimited fine and up to two years' imprisonment. Guidance on CPRs can be found on the NTSELAT website.

As the CPRs do not distinguish between tenants and buyers or sellers, tenants can be just as affected by a lack of material information; albeit to a lesser extent with some kinds of information, such as tenure. Consequently, the guidance also applies to listings for property to let.

Guidance categorises and clarifies material information

The guidance is divided into three parts.

  • Part A covers inescapable costs. These include essential financial commitments such as the price or rent and council tax, or rates in Northern Ireland. Tenure is also included because leasehold entails fundamental considerations such as ground rent, service charges and the amount of time remaining on the lease.
  • Part B includes information that must be established for all properties, such as details of construction, utilities and parking. It also covers non-standard features that would affect a consumer's decision about a property.
  • Part C relates to factors that may or may not need to be established, depending on whether they affect the property. This might include considerations such as flood risk and whether the building is listed, or in a conservation area.

The guidance is what NTSELAT considers to be good practice, and it will be updated as appropriate.

It is not intended to be an exhaustive list of what constitutes material information; rather, it is designed to help property agents in interpreting material information. A full list of the material information categories and guidance can be found on the NTS website.

At NTSELAT, we are pleased with the way the guidance has been received by property agencies. Feedback suggests that agents appreciate having greater clarity and consistency about the information they provide, helping to create a level playing field. 

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Collaboration with conveyancers can help agents

Agents are not expected to become surveyors or conveyancers; neither are they expected to recognise every aspect of or issue with properties. However, they should carry out appraisals using a property information questionnaire to determine what the material information is.

The guidance also recommends that the agent engages with a conveyancer, whether as a third party or by encouraging the vendor to do so directly. Agents are marketing the property and must make enquiries where necessary to ensure that the information being provided is correct, and conveyancers and surveyors can help.

Engagement of conveyancers, for instance, will help speed up the process for all stakeholders. It will also encourage greater collaboration between them and agents.

Conveyancers will always be needed to clarify legal information. It is in everyone's interest that truthful, accurate information is provided to buyers at the outset so that resolutions to any identified issues can be found, avoiding time and money being wasted later and sales falling through.

By following this guidance, property agents will help to improve the homebuying and renting process. This will lead to more informed customers, fewer complaints, and ultimately better practice and greater trust in real-estate professionals.

Empowering consumers by improving understanding

The guidance not only helps give clarity and consistency to agents, but also to landlords, sellers, tenants and buyers. In The case for change: improving the provision of material information in property sales and lettings, our research shows that 87% of consumers agreed that a listing should include all key information about a property.

The updated guidance can help inform buyers' and tenants' decisions alike, and prevent failed transactions or withdrawals at a later stage.

NTSELAT has also published quick guides for agents, for landlords and sellers, and for tenants and buyers, to help explain why they are being asked to provide the information and why they need it.

Education is fundamental – an informed consumer is an empowered consumer, and those who know why they need the information and its importance will start to ask better questions.

Ensuring that they trust agents, conveyancers and surveyors remains paramount, and will also enhance professionals' reputation.

Engagement with profession to monitor impact

NTSELAT will continue to engage with all steering group members, including property portals that are monitoring how far the newly requested information is being provided through their data feeds.

We will also continue to work closely with The Property Ombudsman and Property Redress Scheme to analyse complaints data regarding the provision or lack of material information.

What is important to remember is that material information is not a new concept, and our categories reflect the minimum amount of information to disclose. Agents can choose to include as much information as they want, so long as it is truthful and accurate.

Emma Cooke is policy and information manager at NTSELAT
Contact NTSELAT: Email

Related competencies include: Leasing and letting, Legal/regulatory compliance, Property records/information systems, Purchase and sale

RICS webinars on material information guidance

RICS has produced a series of webinars on the latest material information guidance published by NTSELAT. Members have on-demand access to the webinars via the RICS Online Learning Academy.

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