The quick-sale property industry has set up a trade association and joined the Property Ombudsman scheme.
It means that consumers who have bought through some quick-sale companies can now, for the first time, get redress.
The National Association of Property Buyers launched yesterday with nine members.
It insists that its members belong to TPO and subscribe to a new code of practice which comes into effect on July 1.
While entirely voluntary, the moves are in response to an OFT study into the quick-sale sector last August.
That report recognised that the quick-sale industry did have a useful service for those needing to sell their homes fast – but was damning of some of the practices.
These included companies offering, for example, 80% of the market value of the property, but then dropping it at the last minute.
The study also found that some companies promised quick sales but tied vendors – desperate to sell quickly – in to long contracts. It also said that some vendors were vulnerable, through causes including bereavement.
Other concerns were hard-sell tactics, and that some quick-sale companies were not, as they said, cash buyers, but would be relying on getting mortgage finance or finding a sub-agent.
The OFT study itself followed some critical TV and other media coverage of the quick-sale business.
The new code does not lay down the amounts that quick-sale companies can offer vendors – it does not say that offers to buy must go no lower than, for example, 80% of market value – but it does stress fairness and transparency.
Nor does the new code ban quick-sale companies from tying vendors in to long contracts. However, while there is no ban on such tie-ins, the code says that the implications, costs and duration should be clearly explained to the client.
The code also stipulates that there should be no aggressive selling or harassing behavior, and that all consumers should be treated equally, regardless of a number of factors, including disability.
It also says that “special care” must be taken of clients who are disadvantaged because of their “age, infirmity, lack of knowledge, lack of linguistic ability, economic circumstances or bereavement”.
Jonathan Rolande, NAPB’s founder member, told Eye: “The OFT strongly suggested that the industry get itself in order. Originally, there were some 30 companies talking about a trade body, but this whittled down to the current nine – possibly because a number of the companies use different trading names, and so there aren’t as many as might have been thought.
“The nine of us do represent a big chunk of market share, but we are certainly hoping that others will join us.
“We actually don’t think that more than 20% of customers are vulnerable: in most cases, our services are used where chains are in danger of collapse.”
Rolande, whose own company is House Buy Fast, and who also runs online estate agent GetAnOffer, said that despite the housing market recovery, the quick-sale industry seems as busy as ever.
The Competitions Markets Authority (CMA), which took over from the OFT, said it welcomed the launch of NAPB.
Ombudsman Christopher Hamer said: “The OFT’s market study provided a real insight into the sales practices of property-buying companies. It is a credit to those firms that have set up the NAPB that they have taken action to address the findings, and worked with TPO to create a new Code of Practice and facility for consumers to access a free, independent dispute resolution service.”
The nine companies in the NAPB are:
House Buy Fast
House Buyer Bureau
National Property Trade
Homes Bought Fast
Quick Move Now
We Buy Any Home