In an important ruling affecting how letting agents must advertise their charges, Countrywide firm Hamptons has had a complaint upheld against it over the display of “other fees may apply”.
The advertising watchdog has effectively said that agents who say that “other fees may apply” could also be interpreted as saying that “other fees may not apply”, and is therefore unclear.
In their advert, Hamptons had hyperlinked their “other fees may apply” line to further information about fees.
However, the Advertising Standards Authority has upheld a challenge as to whether this makes it sufficiently clear about how letting agents display their fees.
The Hamptons advert said: “£1,200 per Calendar Month + £216 incl VAT admin fee per property + other fees may apply”.
The unnamed complainant said the information was not clear as to what might be payable.
The advertising watchdog agreed, after looking at Hamptons’ arguments.
Hamptons argued to the ASA that the admin fee was the only fixed charge.
It said the hyperlink told tenants that “other charges” might be incurred as part of the application process, and that the fee would vary from property to property.
The complaint related to a branch in Bristol where there was an all-inclusive fee covering admin, referencing and check-in – either 35% of the first month’s rent or £420, whichever was the greater.
In upholding the complaint against Hamptons, the ASA said that the £216 including VAT “plus other fees may apply” was problematic.
It said: “The ASA considered consumers would interpret the claim . . . to mean that the administration fee was the only non-optional charge and there might be other fees depending on the situation.
“However, we understood that there were other non-optional fees that consumers would have to pay if they rented the property.
“These fees were a referencing charge and a check-in charge, which would be combined with the administrative charge into an all-inclusive fee for their Bristol branch.
“For other branches, the referencing charge was one of two fixed prices depending on whether the consumer was a tenant or a business, and the check-in charge varied depending on the size of the property.
“We noted CAP Code rule 3.19 stated: ‘If a tax, duty, fee or charge cannot be calculated in advance, for example, because it depends on the consumer’s circumstances, the marketing communication must make clear that it is excluded from the advertised price and state how it is calculated’.
“While we acknowledged details of the costs were included in a document which was hyperlinked to the claim, we considered non-optional fees were material information that was likely to have an impact on a consumer’s transactional decision.
“We considered, therefore, that the information about the non-optional fees was not sufficiently prominent.
“Because the ad misleadingly implied other fees might not apply, and the information about non-optional fees was not sufficiently prominent, we concluded the ad was misleading.”
Comments (7)
How do the online agents get away with their atrocious hidden fee quoting and hard to understand T&Cs ? I dread to think of the hidden fees in using the deferred payment system.
I know of 4 agents currently being investigated by trading standards for still not disclosing fees under the “fees payable” banner. Not surprising they still hide them when you see what they are charging tenants compared to other agents ……. £450 to £500 reference fee and £250 to £400 application fee plus £150 tenancy agreement, plus inventory, plus exit inspection, plus carpet clean, key deposit etc.
Not sure I would call this ‘landmark’ as there have been similar cases such as the fairly recent Your-Move case 🙁http://www.asa.org.uk/Rulings/Adjudications/2013/3/Yourmovecouk-Ltd/SHP_ADJ_201575.aspx#.VTjqQnlFDIU)
I guess use of the word ‘landmark’ makes the story more clickable.
Many agents up and down the country will continue to operate outside the law and the various codes if they can get away with it which is why bodies like the ASA and trading standards should be enforcing exists laws/codes before yet more are introduced.
Banning the fee’s will inevitably just mean that LL’s will be charged more and so rent’s will increase so the LL can recover the increased cost. Tenants potentially paying out more than they do in any fee’s currently.
At least when fees get banned we’ll have loads of space in our adverts again.
Shame we won’t be able to afford to advertise …
Nothing ground breaking or new here, really.
The ASA had previously stated that non-optional fees should be listed along with the rent.
That’s just what they applied in this case: “other fees may apply” implies optional fees, however it actually included non-optional fees (which could be calculated in advance), which was obviously unclear and likely misleading.
Surely if a statement says ‘other fees may apply’ it is factual and not misleading. A prospective tenant only has to ask to find out exactly how those fees relate to him/her. I fear the ASA is trying to justify its exsistence.