Housing in England

Upfront information: We’re some way from where we need to be

We might think we have focused a lot on upfront information (UFI) in recent times and there has been considerable cut-through and understanding on this subject right across our industry. However, I wonder whether we are still where we need to be in terms of both comprehension and preparation?

For instance, according to the recent research that came out of the tmgroup report, ‘Back to the Future’, it would appear we are some way from where we would ideally like to be. When asked a series of questions about UFI, there were some less than encouraging responses back.

51% of conveyancing firms surveyed said they had not even heard of UFI, less than 30% were looking into how they could implement it and about how the same figure had no plans to do anything or were simply not interested in it – while less than 20% were already using it.

That led to the report’s authors headlining this page as, ‘The market is way behind on Upfront Information’, and judging by those results, and a number of conversations I had at our recent Annual Conference, we might have to agree.

I think for many who attended the Conference, there was not a ‘head in the sand’ attitude to UFI and what is coming down the track, but – and again this is understandable given what has been happening in the sector over the last couple of years – work pressures have perhaps made it difficult to keep up with the topic.

Again, our member firms are not of the ‘we’re not interested’ ilk, but have perhaps been so engrossed in the work of conveyancing, that they’ve not been able to take a step away, put the head up, and truly ascertain and understand where we are heading with UFI, or digital ID, digital signatures, etc. Essentially those areas which are going to make a big difference to the work they carry out.

There are more positive figures within the tmgroup research in terms of those already using UFI, and those come – perhaps not unexpectedly – from estate agents, over half of whom say they are now using it.

That will have a lot to do with the National Trading Standards Estate & Letting Agency Team (NTSELAT) Material Information requirements. In February last year, the Part A rules were announced which means that all property listings must include material information such as a property’s council tax band or rate, price and tenure.

And Part B and C are not too far away either with work currently being finalised on what will need to be included, with Part B applying mostly to utility information, and Part C any additional material information that ‘may or may not need to be established, depending on whether the property is affected or impacted by the information’.

The idea is that the provision of this information, at the point of marketing of a property, will be mandatory when all three parts of this project are complete.

Conveyancers should be able to see why this information is also going to be important for them; after all, a buyer is going to be making their offer based on the material information which now has to be provided at the point of marketing the property. That information will be included in all property listings on all portals, websites, etc.

You will continue to be responsible for the due diligence as before, but given your client has based their offer on the material information, you’ll need to know what that information was and be able to check the veracity of it. Did it come from a trusted source or did it come from the seller’s memory and therefore can it be relied upon in the way the buyer might think it can?

This is where the Property Data Trust Framework (PDTF) is going to be so important, because if the information/data provided is found to be compliant with the PDTF, then conveyancers can use it to authenticate its provenance. You’ll be able to see the author of the data, the date it was created and where it came from – for example, the Local Authority, the Water Board, etc.

In other words, conveyancers can rely on that data because of its provenance, for example coming from Authority data, whereas if it has come from the seller or the agent then they will need to check it against the data held by those authorities to ensure its correct.

The point of course, as was pointed out by Edward Donne of Howden at our Conference, is that if conveyancers are not aware they have to ask for this material information then they will simply not know the basis on which the client has made the offer, and they could be liable if they don’t carry out the due diligence required. Of particular interest to PI insurance brokers such as Howden, as you might imagine.

What is the link between Upfront Information and Material Information? Well, UFI is simply the prescribed documents that you would need to review, or deploy AI to review and summarise the Material Information for that property.

Furthermore, what happened to ‘buyer beware’? Well, in reality caveat emptor only applies to specific information relative to the individual’s planned use and enjoyment of the property, as opposed to the information that would be material to the average consumer’s transaction decision. Buyer beware is therefore applicable to much less than we might have thought.

So, you can hopefully see why upfront information is going to be increasingly important with property transactions but also in terms of conveyancers’ line of sight on it, and ensuring it is everything it needs to be.

The good news is we at the CA, and our industry partners, intend to keep providing up to date and detailed information on UFI information to conveyancers, including how best to prepare and everything firms would need in order to competently advise on it. There will be regional roundtables and a roadshow in London, so keep an eye out for dates and details on the CA website, and our social media.

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