Material Information parts A, B, and C – Friend or Foe of the Conveyancer?

It was recently claimed that the National Trading Standards Estate and Letting Agency Team (NTSELAT) was “re-engineering conveyancing by the back door” by introducing the full Material Information Guidance and we were warned that “non-regulated companies” would seek to take advantage of “HIPs 2.0.”

All a bit dramatic maybe? I think so. However, conveyancers would be very wise to study the guidance that is aimed at estate agents in particular. The guidance says:

By adopting this guidance, property agents will help to improve the home buying and renting process. This will lead to more informed customers, fewer complaints, and ultimately greater trust and compliance in the industry and those who work in it.

Material information is defined in the Consumer Protection Regulations as “information which the average consumer needs, according to the context, to take an informed transactional decision”. This means any information which would impact the decision that a consumer makes in relation to a property, such as arranging a viewing, putting in an offer to purchase and proceeding with any other aspect of the process. However, this does not necessarily include information that the consumer wants to know because of their personal circumstances and preferences.

In short, before anyone makes an offer for a property, the idea is that they should be able to discover as much about that property, its facilities, any restrictions, and the surrounding area as is reasonably possible. That doesn’t sound unreasonable does it, especially when they are about to commit time and effort and money into commencing the home buying process. It makes perfect sense to establish before making an offer if the property is suitable for them.

The problem is that estate agents should also disclose (amongst many other things), tenure, restrictions, rights, easements and covenants. Shock, horror, estate agents will now become quasi-lawyers’ it was claimed. What tosh, that is the last thing estate agents want to do. What they do want though is help and assistance from conveyancers.

I received this email from a Bold Legal Group member recently:

“I had a couple of interesting conversations with agents last night about the new Material Information Guidance. One in particular hadn’t yet even heard of the latest changes.

It is clearly a way into agents. I explained them to him about the title and covenant information that would be required, and he asked how they were supposed to find that out – guess who I suggested! I will be meeting with them after Christmas to set up a process so the client can be referred to us prior to marketing to collate the information.

I can see there is an opportunity to gain more referrals from our local independents.”

The bottom line here is that the guidance is here, and it is here to stay and my view is; you can fight it (futile), ignore it (unwise), embrace it (sensible).

If anyone wants to know more about this issue please email me:


Rob Hailstone is CEO of the Bold Legal Group

14 Responses

  1. “The bottom line here is that the guidance is here, and it is here to stay and my view is; you can fight it (futile), ignore it (unwise), embrace it (sensible).”

    I seem to recall that much the same thing was said about Home Information Packs. There are tired arguments from the past.

    This is a re-engineering of conveyancing. But there is something new. Vastly increased risks for estate agents in terms of claims for negligence by disgruntled sellers.

  2. I don’t think that anyone is claiming that the majority of estate agents WANT to become quasi-lawyers, though that is the role that is essentially being forced upon them by NTS. We are now seeing estate agents take notice of the guidance which, regardless of whether you believe it to be good intentioned or not, poses a serious threat to estate agents as well as the property market.

  3. No one really fought HIPs, the Government decided they weren’t working and scrapped them. In my opinion, they should have suspended them, because those of us producing exchange ready HIPs (or as close as one could get to an ERH) were slowing proving they were working. HIPs were about speeding up the legal process, Material Information is about helping the consumer.

    You are both members of PLAG I believe. Property Lawyers Action Group, or is it Property Lawyers Against Growth? If the former, what action will you be taking and when? Who is heading up your group, when will you or they come out publicly so that a meaningful debate can be had.

  4. Good morning Rob

    These debates are important . Let’s stick to the issues. Invective will not strengthen your arguments for a return to the failed experiments of the past, such as Home Information Packs.

    Have a nice day.

  5. When will the industry start to be more proactive like the Bold Legal Group member in the article. This is an opportunity to make the process better and for conveyancers, an opportunity to win more business.

    NTS have written guidelines on the information that is required when marketing properties. Estate agents will not be quasi-lawyers if they engage with a solicitor to deliver all the information required.

    If you’re waiting NTS to tell you exactly what you need to do, you’ll be waiting a long time. Take some initiative and work out who can supply the information and craft a deal.

    If you still can’t see this opportunity that is slapping you in the face, we’re in trouble..!!

  6. I doubt very much agents want to become quasi lawyers but that is very much the role being foisted upon them.

    It is the agent’s duty to verify the information provided by their seller client. It may be required that they have to instruct an independent conveyancer as there is arguably a risk of a conflict of interest for a lawyer to act for both agent and seller.

    I doubt any of this will impact transaction times and all this will do is delay or prevent properties coming onto market in already troubled conditions.

  7. Per the bbc when the HIPs were scrapped:

    ‘Those working in the house sales industry have welcomed the move.
    Estate agents claimed the packs, which typically cost between £299 and £350, were stunting the housing market recovery, as they deterred people from putting their home on the market just to test the water.
    “It will be greeted enthusiastically by both the housing market and house buyers, few of whom have paid much attention to these pointless packs,” the National Association of Estate Agents said.
    “It is also good news for sellers. They no longer need to shell out hundreds of pounds for a piece of pointless regulation that benefits no one.”’’

    Those arguments still hold.

  8. Just because people set up a group or an association that purports to represent the conveyancing profession, does not mean that it does. Conveyancers have not been fully consulted on these measures and as usual the details have not been fully thought through. It’s all very well to say that Agents need to get a Conveyancer on board at the outset but are we now expected to work for free pointing out potential defects of title? Will the vendors wish to pay at that stage? They certainly did not wish to when the Hips were introduced. Also which conveyancers is this work going to be forwarded to? Those whom pay a referral fee to the Agents? There are a raft of difficulties that I can forsee with this arrangement and I am usually a glass-half-full person.

    1. Who paid for HIPs in the first place? Did the packs include searches?

      If estate agents use their referral factory firms to whip up a report prior to marketing, their properties won’t be put on the market quickly. They might need to rethink who to use.

  9. Sorry if my attempt at a little humour has caused offence Stephen. I have been on the receiving end myself many times when delivered by your cohort Colin McWilliams, and in a much more brutal way. This is not a return to HIPs and no matter how many times you say it is, it wont be. If you are up for a public debate in the New Year, you know where I am.

    These changes were not set up by a group Rose. They have come from Trading Standards because they think (hope) they will benefit the public. We simply need to find the best way to help implement them.

    If there are any further posts today and I don’t reply please excuse me. The BLG team are off for our Xmas bash shortly. It involves axe throwing, which should help relieve my frustration levels:)

  10. There is absolutely no reason why conveyancer should do this for free. You’re adding value so, have some pride in work and charge for what it’s worth. There have been numerous studies that have proved more information upfront speeds up the process and reduces fall throughs.

    If you’re sceptical of this, try it yourself and find out whether it works for you. Don’t just take a defensive view and say “it’s never going to work” or “no one wants this”, because that’s not helpful. Be positive, think of it as an opportunity because there are already conveyancing firms out there looking to deliver this data.

    1. But Christian, we already had a very good case study of what will happen, see the failure of HIPs. Unregulated firms (and/or AI) will prepare poor quality packs ‘on the cheap’ because that’s what vendors will generally want- the lowest possible cost. Conveyancers will probably be given the choice of preparing the packs for cheap (or for nothing) or not at all.

      There may well be some outliers where this works semi-successfully, but I can’t see this being commonplace outside of firms owned by or heavily dependent upon estate agents.

      1. Colin, With the greatest of respect, that was in 2007, 16 years ago…the same year as the first iPhone!

        Just because HIPs didn’t work then, doesn’t mean MI won’t work today. Back in 2007 we didn’t really have real estate data APIs that can receive an address and return hundreds of attributes about that location. But we do today. Delivery MI data is a piece of cake with todays data & technology.

        If anyone is interested to know more, let me know and I’d be more than happy to discuss this in more detail.

  11. The jury is out. If agents use this properly and encourage their sellers to instruct good quality conveyancers to prepare the MI, it could work very well and reduce fall-throughs (although in my experience, fall-throughs are not that high – presumably to do with taking on reasonable caseloads at a good fee). The conveyancers will get early access to client instructions, and a modest additional fee for compiling the information, and the chance to try to pre-empt enquiries raised by potential buyers.

    However, if agents farm the work out to the cheapest bidder, or the conveyancer who is paying the highest referral fee, it’ll be a waste of time and will never work. Similarly if agents recommend the cheapest bidder / highest referral-fee payer to buyers, the work done on the MI will be ignored/wasted.

    Agents need to work with local trusted conveyancers, and conveyancers need to approach agents with clarity about how they can help. Let’s see…

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