Losing a house sale is always frustrating, but it's made all-the-more confusing if you aren't getting any feedback.
I've been there.
Your sale's just fallen through, your estate agent puts the house back on the market, but you they haven't told you what actually happened with the sale.
So do estate agents have to tell you why a house sale fell through?
Your estate agent has a duty to tell you why a sale has fallen through. Not doing so would be an "omission of material information" under Consumer Protection Regulations from 2008. This is unlawful, and can be punished with unlimited fines and up to two years in prison.
Misleading you with the incorrect information is also unlawful.
These protections are in place so that estate agents can't make critical omissions (or use misleading information) to try and keep your business. They must tell you why a sale has fallen through so you can make an informed decision about whether to continue with their services.
Long story short, getting feedback about why a sale has fallen through is critical to help you sell your house. If your estate agent isn't doing it, they're not only skirting the law, but are also being really unhelpful. You should probably find a new estate agent. Read more in this article about the best way to sell your house.
1. Why would estate agents try and withhold information?
You may think that your estate agent works for you, but it's important to remember that at the end of the day, they work for themselves and their company.
Although they'll generally have your best interests at heart, there may be occasions where it's in their own interests to withhold information from you to try and get the outcome they want.
- If the sale has fallen through due to lack of communication from the estate agent, it'd benefit them to keep this quiet.
- Likewise, if the buyer withdrew because the property description the estate agent wrote was totally incorrect, they may want to keep this one down too.
Fortunately for home sellers, these kinds of practices are prohibited by law.
Estate agents are bound by the Consumer Protection from Unfair Trading Regulations 2008. They are not allowed to withhold information which ‘distorts the economic behaviour of the average consumer’. This includes information about why house sales fall through, as this may affect your decision to continue the sale with them.
In this article we will look at
- Your estate agent’s obligations to you
- How these obligations apply to sellers
- What your estate agent has to tell you
- How to make a complaint
2. Your estate agent’s obligations to you (what they can't do)
The Consumer Protection from Unfair Trading Regulations 2008 (CPR) superseded the Property Misdescriptions Act 1991, which was repealed in 2013.
The new laws are designed to protect both buyers and sellers.
Under the CPR, sellers are seen as customers or consumers of the estate agent’s services. This means they're given protection against a number of practices, including:
- misleading actions,
- misleading omissions,
- and aggressive practices.
We'll cover each briefly below.
2.1. Misleading actions by estate agents
The estate agent can't mislead you with incorrect information.
Here's what the law says:
"providing false information or presenting information … in a way which deceives or is likely to deceive the average consumer and, as a result causes the average consumer to take a ‘transactional decision’ (such as a decision to continue marketing the property) which they would not otherwise have taken"
I've written more about dealing with estate agents here:
Recommended: What is the best way to sell a house?
2.2. Misleading omissions made by estate agents
The agent can't deliberately just leave out important things, or fail to find out about them. Finding out why your house sale fell through falls into this bucket.
Here's what the law says:
"the omission or hiding of material information in a manner which is unintelligible, ambiguous or untimely or does not make its purpose clear and again, which causes, or is likely to cause the average consumer to take a transactional decision they would not otherwise have taken"
2.3. Aggressive practices by estate agents
Finally, we as sellers are protected against aggressive practices the agent might use to win or retain our business.
Here's what the law says:
"behaviour which significantly impairs the average consumer’s freedom of choice or conduct in relation to the product concerned through the use of harassment, coercion or undue influence; and thereby causes them to take a transactional decision they would not have taken otherwise"
3. What your estate agent has to tell you
Estate agents need to be honest with their customers, even if that means telling them why they can’t sell their home and ultimately losing their business.
It shouldn’t take legislation to make the process open and honest, but it is good to know that the CPR is there to protect sellers from unscrupulous agents.
3.1. What do the Property Ombudsman say?
Former Property Ombudsman, Christopher Hamer, writing for Estate Agent Today several years ago, explained the estate agent’s position:
“You have a duty to your seller to ascertain feedback, and if for example a structural defect is found, then the seller would want to know that because further marketing would be compromised.”
In other words, the agent has a duty to tell you why a sale has fallen through, so that you can make an informed decision about whether to continue with the sale.
The guidance issued to estate agents explains that they must share "open, honest, clear and timely information".
Withholding this information in order to keep your business, or failing to find out, is unlawful and can be punished with unlimited fines and up to two years in prison.
4. How to make a complaint
If you feel that your estate agent has misled you about why your property sale fell through, or has withheld or omitted to tell you important information that would affect your decision to continue with the sale, then the first thing you should do is raise the issue with your agent.
If you're not happy with their response then you can make a complaint to the Property Ombudsman.
You can withdraw from the estate agent and take your business elsewhere, or take your property off the market altogether. Since most estate agents work on a no-sale-no-fee basis, you should be able to withdraw from the sale without penalty. However, make sure you check your contract and terms of service carefully to make sure that there are no costs for pulling out.
5. Options if house sale has fallen through
It's all very well and good knowing what your estate agent should have done, and how to file a complaint against them...
But where does that leave your house sale?
If you're back at square one with your sale and wondering what to do next, you've got 2 or 3 main options. A good starting point is to check out my guide on the best way to sell your house. It talks through the various methods, and will help you get going again.
If you don't want to go back to square one, and you just want your house sold fast, then it could be worth getting an offer from a genuine house-buying company. I've been in and around the "quick house sale" industry for years, so I can help point you in the right direction.
Although you can get a genuine cash offer within 24 hours and complete in as little as 7 days, this route does come with a compromise. You should expect to sell for around 80-85% of your last sale price. Hit the button above to explore this solution further.
By Matthew Cooper, Founder of Home Selling Expert