All estate agents use different terminology to define the status of a property, and The Property Ombudsman’s Code of Practice for Residential Estate Agents does not define which term agents should use.
In the Ombudsman’s view, ‘Sale Agreed’, ‘Under Offer’ and ‘Sold Subject to Contract’ all propose the same: that the seller has accepted an offer on the property, that is, a sale has been agreed, but contracts are not yet exchanged.
‘Sold’ should only be used once contracts have been exchanged.
Now, taking into consideration Consumer Protection from Unfair Trading Regulations 2008 (CPRs), NTS Guidance and TPOs Code of Practice for Residential Estate Agents, the following primary authority advice has been issued to clarify three ambiguous points:-
- Can properties be shown with a ‘SOLD’ or ‘SALE COMPLETED’ sticker rather than ‘Sold subject to contract’ following exchange or completion of a sale?
This question refers to advertisements inside estate agents’ physical premises rather than For Sale boards at a property.
The NTS Guidance (National Trading Standards Estate Agency Team) on property sales states that the term ‘Sold’ can be used only after contracts have been exchanged.
Therefore, if a property is ‘Sold Subject To Contract’, it should not be advertised as ‘Sold’ or ‘Sale Completed’, as this would not be true and could be misleading.
‘Sale Completed’ should only be used for properties where completion has taken place.
- Does an agent need the new owner’s permission to use a recently sold property when creating a ‘Sold in your road’ flyer to send to neighbouring properties?
As far as the CPRs are concerned, there is no barrier to identifying a recently sold property in marketing material, provided the house shown as having been sold was indeed recently sold by the agent using it in their advertising.
Whilst the copyright in the photograph image will likely belong to the agency via its agreement with the photographer, it is a requirement in paragraph 3b of TPOS Codes of Practice that agents seek the new owner’s permission in any canvassing material.
If permission is obtained, we would consider properties to be ‘recently sold’ for a period not exceeding one calendar month from the date of completion.
- Can previously sold properties be used on a wall display in the office on a long-term basis, or is there a time limit for this?
Previously sold properties can only be used on a wall display or any other canvassing material if the new owner’s permission has been obtained in line with paragraph 3b of the TPOS Codes of Practice.
The NTS Guidance suggests that “Leaving details of properties that an agent has sold on their website or in their office window for a long period of time (to the extent that it creates a false impression that the agent is selling more properties than they actually are)” could be a breach of professional diligence.
Our guidance is that a ‘long period of time’ would be more than one calendar month, starting from the date of completion for properties advertised as ‘Sold’.
However, if property marketing material is clearly and boldly marked with the actual date of completion, leaving consumers in no doubt when it was sold, it would then not create a false impression of selling more properties than are being at that specific time.