Estate Agents Legal Obligations to Buyers

7 min read
Estate Agents' Legal Obligations to Buyers & What to do if they are not met. A guide from Parachute Law. An estate agent in a blue suit shows a young couple around a light airy property.

What are estate agents' main legal obligations to buyers?

Estate agents' obligations to residential buyers are governed by The Property Ombudsman (TPO)'s code of practise. This document covers best practise as well as legal obligations.

Beware: Some estate agents are not members of the Property Ombudsman

Agents who are not members are not obligated to follow the rules for best practise, as set out in TPO's code. Non-membership may be a red flag for underhand practices. Your agent will tell you if they are a member.

Estate agents, property developers and websites who introduce buyers and sellers are regulated by Consumer Protection. This protects you, the consumer, from unfair or misleading trading practices, misleading omissions and aggressive sales tactics.

However, until recently, many buyers were not receiving crucial information regarding the property until later in the process. Sometimes, having already instructed their conveyancer and paid for surveys on the purchase before learning that the property was in fact leasehold.

What Should be included in the estate agent's marketing information?

Phase A of a series of updates introduced by the National Trading Standards Estate and Letting Agency Team went live in May 2022, to ensure that the following is included in the marketing information of any property listing:

  • Asking price
  • Freehold/Leasehold
  • Council tax band/rate
  • Any reservation fees
  • Shared Ownership percentage
  • (Including rent on Housing Association's share)

Tenants will benefit from these rules as well, with stricter requirements on the information listed about deposits and deposit holding.

Unfortunately, the new rules will not become mandatory until phases B and C are completed 'over the coming months'. These phases will include additional important factors which may impact your property, such as:

  • Restrictive covenants
  • Flood risks

This information comes as a response to agents requests for clarity on what should be included as standard in their property listings and will help buyers in their property search, to make better informed decisions based on the potential financial implications of these factors.


    Estate agents' obligations to describe the property

Whilst it is an estate agent's job to portray a property in a positive light, they cannot be dishonest:

Estate agents must
Estate agents must not
  • Disclose any information of which they are aware or should be aware of in relation to the property in a clear, intelligible and timely fashion
  • Take all necessary steps to provide accurate descriptions of properties they are marketing
  • Say anything verbally, or in writing, to potential buyers that is misleading or inaccurate
  • Present unrealistic photos which hide or omit existing features


    Estate agents' obligations concerning important information

Your estate agent cannot withhold information which might impact your choice to view, make an offer or buy the property. The information they do provide must be accurate and not misleading (see above).

They must also investigate any potential problems they have mentioned to you, if they suspect they may become an issue later, such as damp or leaks.

Examples of information your estate agent is obligated not to withhold

  • Planning permission has been granted for a major development nearby
  • The property is in the close vicinity of a power station, sewage works, school, nightclub or halfway house
  • The reason, if a number of sales have fallen through on the property
  • Any murder or suicide which they're aware of having taken place within the property
  • ASBOs against any neighbours
  • Burglaries in the area


    Estate agents' obligations to pass offers onto the seller

Unless the seller has requested not to be notified of certain offers (i.e., any offers below the asking price) then the estate agent must pass all offers made before the exchange of contracts, as soon as is reasonably possible.


    Estate agents' obligations to remain unbiased

Your agent cannot discriminate against different buyers, for any characteristic protected by The Equality Act, or, where the buyer has indicated that they won't accept related services from the agent.

Examples of prohibited discrimination include:
  • Failing to pass an offer on to the seller
  • Passing a specific offer on later, or more slowly than other offers
  • Misrepresenting a specific offer, or rival offers
  • Giving details of a sale to a specific buyer(s) before others, giving that buyer a 'head start'
  • (Especially where the buyer has indicated that they will use the agent for related services)

What are estate agents' legal obligations to buyers of leasehold properties?

Your agent should warn both sellers and buyers of additional fees which could be incurred for leasehold specific items such as:

  • Your leasehold information pack

As well as information regarding:

  • Service charges
  • Ground rent
  • Length of lease
  • Any known special conditions

Frequently Asked Questions

Can I sue my estate agent for negligence?

  • The agent breached their duty of care to you
  • You suffered financial or personal damage
  • You can prove that this damage was caused by the negligence of the agent

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