We previously blogged about the changes to Regulations which protect consumers from unfair commercial practices. This follow-up blog seeks to suggest some practical tips for housebuilders on how to avoid falling foul of the Regulations.
- Local information
- Ensure that enough is known about the local area to answer any reasonable queries of prospective purchasers accurately. This may include information on schools in the local area or shopping facilities.
- Review this information to ensure that it is kept up to date.
- Provide information to prospective purchasers on where they can obtain more information on the local area such as flood risk maps or public information about local amenities.
- Marketing materials
- Ensure that any professionally prepared brochures provide accurate information. Any misleading or incorrect items should be corrected as quickly as possible, and brought to the attention of the sales team.
- Any material information (good or bad) which a buyer may reasonably require should be provided.
- Sales practices
- Avoid giving short deadlines for incentives which may force buyers into making a decision too quickly.
- Consider what information a buyer can reasonably expect to be given when considering purchasing a house in the specific area where the site is.
- Keep a note of any advice given or incentives offered.
- Ensure that regular training is provided to sales teams, and that staff keep accurate records.
- Always make sure that sales staff are aware that they must honestly answer questions from buyers, even where the answer may not be appealing to the prospective purchaser. Equally, if the answer to a question is not known, simply say so and check it out after.
- Contract information
- Make sure that the terms of the contract are clear, and that all terms are provided in writing.
- Highlight any surprising terms, and draw material information to a buyer’s attention before the contract is signed (such as service charge, insurance etc).
- Ensure that buyers have adequate time to read the contract and any supporting documentation before signing it.
Practices are judged against the standards of the ‘average consumer’, however this does account for social and cultural factors.
It is worth putting yourself in the position of each prospective buyer – what would you want to know?
As long as you are able to demonstrate that all efforts have been made to provide the buyer with accurate information, and there are procedures in place for training sales staff who are at the forefront of passing this information on, you will have taken a giant leap forward in protecting your business against any potential claim under the Regulations.
For more information, email firstname.lastname@example.org.
 Property Misdescriptions Act 1991