Last Friday there was an article by Ed Magnus on the This is Money website headlined:
Every ‘available’ property on Rightmove is under offer: Are estate agents tricking us, and do we really need to sign up for annoying emails?
A couple were bemoaning the fact that in setting out to buy their first home they had shortlisted some properties that they found online but were finding that when they phoned the estate agent to set up a viewing they were told that the property had just gone under offer.
They said that the experience left them wondering if estate agents deliberately leave properties listed as ‘for sale’ even if they are just ‘under offer’. They questioned if agents are allowed to do this and thought it might be a ploy to get the applicants’ personal information and requirements.
The responses from Ed Magnus, Ewen Bunting of James Pendleton, and buying agent Henry Pryor correctly told the couple that there is nothing illegal in the practice but also agreed that it is a way for agents to gain more applicants.
Henry Pryor said he has campaigned throughout his career for the practice to change and hopes that in future Trading Standards will require agents to update the status of SSTC properties on their website listings.
It is clearly a matter of considerable irritation for applicants to find that an ‘available’ property is actually far from available, and EYE would like to know what readers think.
Does your agency deliberately leave properties showing as available after they have gone under offer?
What is the justification for doing so? Is it to line up alternative buyers in the event of the sale falling through? Do you think you might get a competitive bid coming in prior to exchange? Or are you simply using the tactic to encourage more applicants to register with your firm?
And on your boards do you use Sold – with a small ‘subject to contract’ tucked down in a corner, or do you use, ‘Under Offer’?
What’s your view? Take a moment to complete this poll – which closes at 7pm this evening. We will bring you the results later in the week.
[yop_poll id=”16″]
Comments (20)
Thank you for the clarification. I thought that was what you meant and confirms my thoughts. Had my agent followed that procedure, I would not have wasted months on a buyer who could not get a mortgage.
Chris are ypou saying advertising and viewings should stop if a property is Under Offer/SSTC?
No….. BUT, the property MUST be immediately advertised as UO/ SSTC etc. Potential viewers who call/ email in wanting to view MUST be informed that the property is under offer/ SSTC (in case they did not see the adverts etc) and whether the owner will consider new offers or not (having first taken client instructions and, ideally, confirmed this in writing to protect yourself). The owner MUST be asked if they want to continue marketing/ allowing viewings and IF the owner wishes this to be the case, the prospective buyer whose offer has been accepted MUST be informed in writing (some of this strays into TPOMB code rather than law but I’m a little busy today at work to reference everything).
Previous articles in PIE have stated that fall through rates have risen dramatically in England. We wait until after the mortgage valuation is done in order to create a “safety net” in case anything goes wrong.
I had composed a hopefully helpful and comprehensive reply but for some reason, it has been lost during posting. What follows is a cut down version with a few links to other useful website ommitted. In essence, if you or other agents continue to not advertise a property as under offer or SSTC (the various common usage wordings used is relatively immaterial in law), you are in danger of landing up with a potential two-year custodial sentence and a criminal record. “The law The CPRs prohibit misleading actions that cause, or are likely to cause, the average consumer to take a transactional decision they would not have taken otherwise. The definition of a ‘misleading action’ is very detailed (regulation 5 of the CPRs) but it essentially means providing false information or giving an overall presentation that deceives or is likely to deceive the consumer, even if the information is factually correct. The CPRs also prohibit the omission of material information provided to consumers if that omission could cause the consumer to take a transactional decision they would not have taken otherwise. ‘Material information’ is defined as “information which the average consumer needs, according to the context, to take an informed transactional decision”. A ‘transactional decision’ is not just whether a consumer decides to purchase a property, but could include such things as whether to view a property in the first place.” Source:https://www.businesscompanion.info/en/quick-guides/services/property-descriptions-sale-or-let
There is perhaps an argument that a property might still be considered ‘For Sale’, even though an acceptable offer has been made that the seller is running with. What if a prospective buyer has not sold their property, and the seller wants to continue marketing? In this case, would a statement at the head of the property description satisfy the CPRs? Something along the lines of:
“Please be advised that an acceptable offer has been received. If you still wish to view the property or make an offer, please contact the agent as soon as possible.”
Also, stated at 8c of TPO’s Code of Practice for Residential Estate Agents (Viewing and Access to Premises):
“Before arranging any viewing, you must tell the buyer if you are aware of an offer that has already been accepted subject to contract by the seller.”
Putting Sold STC on boards and property portals as soon as an offer is accepted is tempting fate. Previous articles in PIE have stated that fall through rates have risen dramatically in England. We wait until after the mortgage valuation is done in order to create a “safety net” in case anything goes wrong.
In have the reverse view. A sale (SSTC) was agreed in November 2020 for £10k under the asking price.. Without my consent all viewings were stopped.
The buyers’ solicitor asked question after question dragging it out until March 2021 when I instructed the agent (very much against their advice) to re-market it because there was no sign of a contract exchange or even a mortgage offer. Reluctantly, mainly because I said that I would instruct another agent, they did so. Within a week I had a firm offer £10k over the asking price and we completed mid-May 2021. The agent then had the cheek to congratulate themselves on the sale.
Provided that the viewer is told of the exact stage of negtotiations beore they view then what is the problem? Not all sales showing as SSTC actually complete.
Sold STC is a hangover from the Town & Country Planning Act (control of advertisements) originally in the early 1990’s and replaced in 2007.
Agents were not allowed to display a ‘sold’ board unless as an extension of a previous ‘for sale’ board. It also limited sizes – remember the old ‘double poster with a flag board’?
You also need to consider ‘confirmation of further marketing instruction’. However, the fact an offer has been accepted is ‘material information’ and could influence a transactional making decision.
SSTC is as old as contract law itself- it is the get out of jail card for stuff the buyer has not been told or is found not to be to their liking, it is nothing to do with T&CA control of board regulation other than it announces to the public, Hey! this one is worth buying; part of an agent’s duty of care and skill to their principal.
It was early 90’s when For Sale, Under offer, Sold boards got messed about with and agents were forced to put incorrect boards on homes no longer available to offer on. Trust me it caused more chaos then than you can imagine. I had a run in with a local solicitor whose daughter wanted to offer on a SSTC that had already exchanged. I sent him and his attitude to the civic centre to talk to the planning officer
Back in the day we always used the three-step system, marking properties as “Under Offer” once a sale had been negotiated, then “Sold” once contracts had been exchanged. But there were always problems with the lingo, and we inevitably received many calls from people asking how much “under” the price they were allowed to “offer”. So we switched our boards and advertising material to say “For Sale”, “Sale Agreed”, then “Sold” or “SSTC”. And this seemed to work. But the portals came along and suddenly properties had to be For Sale or Sold, there was no middle ground, meaning agents had to decide at what point the property was actually “sold” (straight away, or when finances and the chain were verified, or when the survey had been completed, etc).
I reckon re-implementing the three-tier system would save a lot of heartache for buyers, but only if all estate agents would be honest enough to stick to it. And there’s the problem. For example, how many estate agents do you know that “forget” to remove listings from the internet once completion of the sale has taken place? Looks great, doesn’t it, having all those sales going through … even if some of them are last year’s news?
Disgruntled applicant are going to extra special effort to find stuff they’ve missed out on. SSTC’s don’t show by default on the portals.
Waiting for portals to tell you when something has come on the market is not the way to achieve home ownership, especially for FTB’s competing with investors for entry level homes.
I believe that Henry Pryor is incorrect. The matter of SSTC, under offer etc. was raised some years ago (and debated on PIE at the time) as being a matter of Consumer Protection Regulations Act. Specifically, the status of a property. An agent has an obligation in law to display the correct status of a property in the marketing and sale process. Once an offer, subject to contract, is accepted by the seller, an agent must amend the advertising literature as soon as is reasonably practicable (usually regarded as the same working day).
Furthermore, Misdescribing the status or availability of a property/ properties in order to gain business/ give a misleading status about a businesses apparent success could be regarded as gaining business or financial gain by deception, otherwise known as fraud. Portal/ property Juggling is an extension of this practice.
Sadly, despite years of compelling evidence being supplied to NTSLEAT they have failed to act to prosecute the many serial offenders.
Doesn’t surprise me that Henry Pryor is jumping on board with this… It’s a load of nonsense really. But I’m sure some agents – probably corporate ones, are told to do this.
The whole “sold subject to contract” thing is nonsense anyway – property should be marked as “under offer” until contracts have exchanged and then they can be marked as SOLD.
SSTC only came about because it gave dodgy agents in the 1980’s an opportunity to get SOLD on their boards and look impressive. – sadly Rightmove and the portals follow the masses and struggle with the whole “under offer concept. Idiots.
The other thing I might add, in our agency, we did not mark anything as a “under offer” until after the survey has taken place… What’s the point if it’s all going to fall down on survey
Isn’t it about time Henry Pryer got involved with a campaign that helps us all? He’s very good at agent bashing – perhaps he’d like to team up with the Sunday Times to campaign to change the Victorian system of buying houses in this country – it’s a massive scandal, that the stamp duty holiday exposed to be unfit for purpose.
This is a bit of a non-issue really. There is almost always a period of time (1-2 days usuall) after an offer is made where it is negotiated and funds qualified – this is before the property is marked as SSTC.
During this time, viewings might be paused but the property is still available so that new enquiries are still registered so that if the negotiation or fund qualification doesn’t work out – those buyers that have registered can be contacted to view. Seems logical to me.
of course there is always a period of an offer being accepted to it being marked at SSTC. we also all know which agents will leave it on as for sale to get peoples details
This has Chancellors written all over it
No. They are the only agents in town with price reductions, but as they have 6-month Sole Selling contract they can still pick up a fee.
Dexters!