Material information rules will help agents justify higher fees - claim

Providing material information upfront could help agents charge higher fees and even reduce their carbon footprint, while those not complying could face fines and jail, firms have been told.

The latest Part B and C material information rules are expected from the National Trading Standards Estate and Letting Agency Team (NTSELAT) in the coming months.

Agents will be expected to display information on property listings including any restrictions or flood risk and may even have to include the broadband and mobile signal.

Proptech firm iamproperty brought experts Beth Rudolf, director of delivery at The Conveyancing Association and Paul Offley, group compliance pfficer at nurtur.group together, to discuss the opportunity up front Material Information brings for agents. 

Rudolf said: “If we take the Nordics as an example, agents are able to position themselves as a higher value partner to clients, as realtors, they have fees structures much higher than standard UK fees. 

“As well as valuation information they gather legal information and standard property facts, they can advise clients with all the information, help them to make informed decisions and have the time to seek out the best properties for their clients to drive their pipeline.”

She said material information success in the UK will offer agents the opportunity to take the hours saved and use it to provide an even better service for their clients and in time increase their fees.

Rudolf added: “if nothing else, it reduces offer to exchange by 10 weeks on average in pilot. That’s 10 weeks less chasing progress updates for everyone – that has to be a full-time salary saved.”

Whilst it will become enforced, likely with unlimited fines and even prison sentences, Rudolf suggested, she added that providing upfront information shouldn’t be a tick-box exercise.

She said: “Those who don’t build this into their processes and see the potential will likely punish themselves in the long run anyway. 

“Not making the shift will see agents continue to average their two pipeline turns a year and battle a 30% plus fall through rate, as well as wasting hours of valuable time on all of the additional progression points over a 22-week period.”

Offley suggested providing material Information earlier in the process could help agents to accelerate their environmental, social and governance policies and improve their carbon footprint, adding: “As a starting point if every agent could cut back on the number of wasted miles showing buyers around houses that ultimately aren’t suitable, the impact in the UK would be huge.”

The pair addressed concerns that providing upfront information may put sellers off, but Offley suggested it could make a client “more sticky” as they are less likely to move to another agent if they have invested time in providing material facts. 

Rudolf suggested these changes could reduce fall-throughs, adding: “It’s the perfect time to change the consumer mindset when it comes to pulling out of a sale. 

“Recent research showed that buyers feel comfortable to pull out because they don’t have all the information when they make their offer. When they do get it and feel they can make a more informed decision they don’t hesitate to back out or renegotiate.

“Bringing material information up front should help to reduce fall through and change this mindset that making an offer on a home isn’t as big a commitment. It’s a buyers’ market and so it should also help sellers to present their homes in the best possible way to make it attractive to the right buyers.”

Offley added: “It’s not like Home Information Packs or regulation filled with technical information, this is consumer driven so should give agents the opportunity to stand out, delight their clients, win more instructions, get properties sold faster and ultimately get paid quicker.”