Two complaints have been upheld by the advertising watchdog against HouseSimple – which last week won Online Estate Agent of the Year at the Negotiator awards.
A complainant raised two issues to the Advertising Standards Authority relating to a poster on a London tube train.
It said: “… you could just pay our usual fee of £495 and save thousands instead.* Not only do we potentially save our average London client £18,764** in fees, we’re also [X]% more likely to sell a property than a high street agent – and we’re three times faster at selling it++”.
A footnote stated “** Offer is based on an average Foxtons fee of 2.4% +vat (2.88% inc vat) (Based on Average Foxtons fee for 2014, Peel Hunt Market Report) and is available to clients whose properties are sold and completed at £377,000 or above … ++ Based on data from Rightmove.co.uk”
The complainant queried whether the claims to potentially save the average London client £18,764 in fees, and being three times faster at selling, could be substantiated.
HouseSimple supplied the ASA with a list of London properties it had sold between November last year and June this year. The average fee was £698.
The average asking price was £675,767. HouseSimple had applied the average Foxtons fee of 2.4% plus VAT, calculating this at £19,462. The difference between this figure and theirs was £18,764.
HouseSimple had used Foxtons’ fees for comparison because Foxtons was its most identifiable competitor in London.
HouseSimple also provided an article by the Home Owners Alliance which stated that estate agents’ fees ranged from 0.75% to 3.5%.
On the claim that it was three times faster at selling than a high street agent, HouseSimple said its average selling time was 25 days between October and April. Rightmove’s house price index for February had said the average time to sell across the UK was 79 days.
However, the ASA upheld both complaints.
It said HouseSimple had not proved that Foxtons’ fees were representative of fees charged by London agents. The information provided on the Home Owners Alliance website did not state how the range of 0.75% to 3.5% was calculated, whether it applied to London or nationally, how recent the figures were, and whether they included VAT.
The ASA said that HouseSimple needed to demonstrate that at least 10% of its clients had paid £18,764 less than they would have done had they used a high street agent. No such calculation had been provided.
The ASA also upheld the complaint regarding HouseSimple’s claim to sell houses three times faster than high street agents.
HouseSimple said its average sale time was 25 days, which was three times faster than the UK average given by Rightmove of 79 days. However, Rightmove had also quoted a London-specific figure of 58 days.
Other data supplied by HouseSimple, from the search engine Home, showed an average selling time of 120 days, but this related only to south-west London.
HouseSimple was told not to repeat the advert again and to hold documentary evidence to substantiate any claims made.
Earlier this year, HouseSimple received a major boost with a £13m injection from Carphone Warehouse founder Sir Charles Dunstone and his business partner Roger Taylor.
So is it. Say what you want and get a little slap on the hand?
The ASA are not the easiest to get through to. And when they do take action. It seems to be pointless.
They should make false claimers advertise false and misleading claims in the same places as previously shown
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‘at least 10% of its clients’. Can somebody explain how 10% equates to Average. Is this a new algorithm that we can all use? I can prove that at least 10% of my clients sell at more than 5% above asking price. Does that mean I can now claim ‘on average’ that our clients sell at 5% above asking price or more? Or am I reading this completely wrong.
Once again a business is allowed (for a period) to manipulate figures to make it look the norm, and insinuate it is. We need a definitive ‘high street average fee survey’ once and for all to help challenge this disinformation propaganda that’s being used to misinform and mislead consumers!
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all a load of nonscene.
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Was the challenge to find the 3 people least qualified to talk about estate agency as a service industry? The wheels are coming off all three of those businesses because they don’t know what genuine service is.
Countrywide, Emoov, ZPG who can remember when there was something positive published about any of those firms that their PR departments didn’t write?
Rather than the home truths seminar a more appropriate title would be; why is is going all so horribly wrong?
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The whole rotten egg is when a company has to use its competitors to justify their own brand. How about trying to sell just what you do, without resorting to throwing stones at your competitors. But then you wouldn’t look very good. ASA should outright prohibit the behaviour of refereeing to other companies. They and their ilk are doing it on a nationwide scale and is the only way they can try and look good and dupe people.
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Totally agree….in actual fact the CMA (Competition and Markets Authority) has lots of rules about unfair use of market position….such as making losses in order to squeeze other businesses out, as shown in the video;
https://www.youtube.com/watch?v=cemTusT9ufs&index=5&list=PLJREEEp2I-xekJrmVFH-X21S-uHTG_R4x
I wonder what they would think about a ‘deliberately loss making organisation’ using its losses as a directly targeted way of taking business away from its named competitors? It shouldn’t be allowed on many fronts.
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“HouseSimple had used Foxtons’ fees for comparison because Foxtons was its most identifiable competitor in London”
Nooooooooooooooooooo!
One is a well respected agent who has been innovating estate agency for the last 40 years. It ranks for every single estate agency keyword worth ranking for (except online estate agent) and has dominated the London property market for years and years. It has built a brand name that is searched for on Google 60,000 times a month. It is cash rich and turns a profit.
The other is a poorly run, poorly rated (Trustpilot) quite expensive (for an online only agency) business with no new technology and no brand awareness (260 Google searches for House Simple estate agents per month) that needs to bid on Google search terms like Purplebricks to buy customers. Emoov do the same silly bidding. It is cash poor and makes losses.
Keep fighting eachother, keep bidding higher and higher, keep making Google rich.
But don’t compare yourself to real estate agents.
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Hi LondonR90,
Can I ask where you obtained the information and figures on google search terms? Was it google trends or another site? Be useful to use it in some research I am doing. Thanks
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Firstly, when it comes to numbers, no information is 100% – unless you are looking at your own Google analytics account. There a lot of programmes and softwares which can be used to analyse competitors – then you interpret it best you can.
I use Ahrefs, Semrush, Majestic Seo and some other, less well known, software programmes. You can analyse a lot of things like competitor keyword ranking and competitor backlink profiles (ie what makes them rank).
If you know your business like I do then you can spot paid links. Someone called Matt Cutts will certainly be able to. Not only that, but there’s a lot of reporting of competitors that goes on. That’s why I’ve warned House Simple. If I can spot it then Googles algorithm wont have a problem.
Careful though, not only is the software quite expensive (about the price of a RM membership) but it is also hard to interpret if you do not know what you are doing.
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Thank you for taking the time and trouble to give such a detailed answer. I would like to pick your brains on an idea outside of the forum if possible (and if you are willing). Only, obviously I don’t know how to contact you. Perhaps Ros could put us in touch?
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Yes, sure, look forward to your email.
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And, please stop buying links…
Google does not like it and you will get deindexed and not rank for the tiny amount of keywords you currently rank for.
It happened to Interflora so it will happen to you. Especially if someone makes it happen 😉
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“The jury will disregard that last remark” But of course they never do. It was said and it sticks.
When is someone in authority going to wake up and recognise they are pulling the wool over the consumers’ eyes?
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