The coming into force on April 4 of the Property Misdescriptions Act is already being greeted by shouts of “foul” from the property world, mixed with cries of horror at the punitive nature of the sanctions prescribed for offenders.
As is ever the case with any new “story”, the most extreme reports – of estate agents refusing to print particulars describing a property in any other way than a “detached house” for fear of being leapt upon by an over-zealous trading standards officer – are wide of the mark. Equally, however, any agent – and unfortunately there are still, in my experience, a large number – who regards the Act as not worthy of attention because of his/her firm’s long and unblemished history is in for a rude awakening. And, while I have no particular sympathy for them, it is not the scaremongers who have saddled the profession with this Act, but rather the much larger numbers of totally apathetic agents.
In my view, apathy about standards, service and competition has plagued the property profession for too long, and the chickens, in the shape of the new regulations under the Estate Agents Act and now this Act, are coming home to roost.
There were clear warning signals during the late 1980s about the Government’s intention to act to “curb the antics of unscrupulous agents” following an increase in complaint levels from consumers to the OFT as the market grew steamier in the second half of the decade. In summer 1989, the DTI issued a review of estate agency, swiftly followed by a consultation document from the OFT that autumn. In the following spring, the report on estate agency by the Director-General of Fair Trading (which grew out of the previous two documents) was issued and effectively foreshadowed the new regulations under the Estate Agents Act which became law the following summer.
To this major watershed consultation process for estate agency – open, remember, to any property professional who even glances through the journals – the OFT received representations from just 136 individuals or organisations; and of these 56 were not estate agents or representative bodies. In other words, only 80 estate agents/firms/professional bodies took the trouble to express views on important proposals to make major changes to their methods of practice in earning a living!
So, we got the new orders and regulations added to the Estate Agents Act in 1991 and, while not Draconian, (they are, in fact, well intentioned) they have done little more than add to the already staggering amount of paper that we all have to thrust upon our long-suffering clients, who simply want their house or office sold or let, quickly and without fuss.
Now we are about to get the Property Misdescriptions Act and I fear that, despite the good intentions of its sponsors, it may do little more than the new regulations under the Estate Agents Act to protect the public interest and to genuinely improve the behaviour of “rogue”agents.
The basic problem, of course, is that few of us like to admit that we are estate agents. This strange attitude prevails among some senior property professionals that it is acceptable, in the good times, to enjoy the profits gleaned from estate agency in one’s practice, but it is not the sort of work with which one wants to be associated personally. Somehow, the operation of estate agency, which at one time was an integral part of a surveying/valuation firm, has become separated out and is now regarded with disdain, or even dislike – there is little hope of improving standards by this attitude.
At the other end of the scale are those who see estate agency as purely a money-making (or losing) business and have no interest in anything other than the financial result. Consequently, businesses are spawned (or converted into) house-selling factories where anything goes, the word “service” is simply a marketing term, and training is confined to cloning salespeople with little interest in the person for whom they are acting or the “product” being sold.
The concept of estate agency being a worthwhile, interesting and enjoyable occupation has faded considerably during the past 10 years. The question is, are there enough of us around who care about our particular discipline to effect a return to healthier attitudes?
I certainly hope so, for, despite the fact that I believe there will be a number of “reputable” individuals or firms prosecuted for “innocent” mistakes (because of their ignorance/misunderstanding of the new legislation), the Act should actually encourage higher standards in the day-to-day practice of estate agency. I hope that one result may be that experienced and/orwell-qualified practitioners will find their skills in demand, and fully stretched again.
For too long properties have been sold or let relatively easily through marketing cliches and mailing lists. The level of expertise/competence required to generate a very acceptable level of salary has not been particularly high. Of course, the recent recession has sharpened everyone up, but come the next boom (or even mini-boom) the same problems will re-emerge. At least the Act will force us all to write our particulars to higher standards of accuracy, put in some workable office systems and be much more imaginative in our marketing techniques.
We might even see real service being offered to both vendor and purchaser in terms of, for instance, accompanied viewings and conveyancing chasing, to say nothing of vastly improved thinking about proper levels of courtesy, efficiency and communication.
The half-day seminars run by the ISVA explored these and other allied issues, as well as giving guidelines to residential and commercial agents alike to avoid the worst pitfalls of the new Act. Although guidance notes were issued at the seminars, delegates were encouraged to think through the implications of this intentionally open-ended piece of legislation and apply tailored solutions to best suit their own firm or organisation.
My principal reservation about the Act -and this also applies to the Estate Agents Act -is that it will do little to improve standardsof behaviour in estate agents, the ostensible reason for both pieces of legislation being brought in.
As an example of this, shortly after the new orders and regulations were brought in under the Estate Agents Act, an ISVA member firm which had been accorded a sole agency on a property had cause to remonstrate with an unaffiliated agent for persistent attempts to “tout” instructions on the property. Exasperated by the continual and unwanted pestering of his client, the member firm contacted the OFT and registered a complaint under section 18 of the Act. The OFT replied that as a contract did not exist between the second agent and the client therefore section 18 had not been breached and no action could be taken against the offender.
Surely the time has come for the profession as a whole to make the point to Government that prevention is better than cure and that the real way forward in improving property service standards for the benefit of the public is toinsist on new entrants to the profession being educated, trained and guided on ethical procedures, all to a minimum standard of competence before they are allowed to practise on their own account.
Government has always argued that such schemes are (a) expensive and (b) encourage a closed shop. Our response should be that the scheme should be self-regulation by the profession but backed by Government.
As for the “closed shop” argument, it simply does not hold water in today’s society and most people would surely agree that a modest entry barrier to our profession would be an appropriate and welcome price for a better-trained and (in the eyes of the public) more trustworthy breed of agent.
Undoubtedly, our short-term target should be to prepare for April 4. I only hope that the professional bodies and other individuals and organisations who genuinely care about decent estate agency standards will set a medium-term target of getting some proper recognition for the estate agency profession by pursuing a campaign for licensing.
Roger Carson FRICS FSVA is a vice-president of the ISVA and chairman of the society’s Residential Estate Agency Committee.
