Property Ombudsman sends warning shot over estate agents’ fees

| July 15, 2009 | 0 Comments

In his latest quarterly review, Property Ombudsman Christopher Hamer has reported a fall of 30% in enquiries regarding house sales while lettings enquiries rose an annual 44%, reflecting the switch in emphasis in the property market slowdown.

At the end of June, around 10,400 estate agents offices were registered under the Ombudsman’s code of practice and of the 1,076 disputes brought to his attention during the second quarter of the year, his office took up 866 cases, the remainder being outside his jurisdiction for one reason or another.

The report highlights concerns over fees and demands that estate agents “take much greater care” when explaining fee structures to clients.

Mr Hammer states: “There is evidence of deliberately induced confusion in the mind of the consumer” and warns that where cases of this nature come to light he will find in the consumer’s favour.

Explaining further, he says: “I am regularly presented with scenarios where the fees, although stated in the Agreement, have been clouded in some way either during substantiated conversations during the market appraisal or through some ambiguity in the wording of the contract.”

In his report, Mr. Hamer cites a case where an agent sold a house for £220,000 but charged a flat fee worked out against a recommended asking price of £300,000.

The valuation was £50,000 above those of two other agents.

The agent offered the complainant £500 in recompense but Mr Hamer judged this insufficient and awarded £1,304 against the agent, resulting in the complainant paying commission to the agent according to his sliding scale for a £220,000 sale.


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