Neighbouring Development - Misleading Omission
Complaint
Following their third viewing, Mr and Miss B made a number of offers for the Property the last of which was accepted. Conveyancers were appointed and a survey instructed.
However, several weeks into the transaction Mr and Miss B viewed a local news programme where it was reported that a large development of 1,200 houses, a retail park and a waterside park were planned in an area 200 metres away from the Property. After further research Mr and Miss B found that the draft proposal had been made public several months before they viewed the Property. They decided to withdraw from the transaction and subsequently complained that the Agent had failed to disclose this information to them, despite stating that they had raised questions about proposed local developments during their viewings. The Agent contested that Mr and Miss B had raised such questions.
Investigation
The Agent’s file contained no record of the conversations held with Mr and Miss B during the viewings, where it was alleged that questions about proposed local developments were raised. I noted that the development proposal was a draft plan produced by the local council which had identified a large area of land close to the Property as being potentially suitable for building. I considered that, given the size of the proposed development and the fact that it would affect the flow of traffic on the road that the Property was situated, it was material information that any potential purchaser would wish to take into account as part of their decision making process.
Outcome
Whilst I was not provided with any evidence which allowed me to reach a judgment on whether or not questions relating to local developments were raised at the viewings, I considered that the Agent, as the property professional, should have been aware of the proposal and divulged this information to Mr and Miss B, preferably before they had viewed the Property. Given the public nature of the development proposal, I did not consider any claim of ignorance on the Agent’s part was reasonable in the circumstances. I accepted that the proposed development would not deter all purchasers (as was evidenced by the fact that the Property was sold promptly to another buyer who knew about the existence of the potential development), however, the development was of a significant size that would deter some purchasers and as such should have been disclosed to Mr and Miss B. I supported the complaint and made an award of £225 for the avoidable aggravation, distress and inconvenience the Agent’s omission had caused.
Learning
The CPRs require information considered material to a consumer’s transactional decision to be disclosed at the earliest opportunity. In this case, whilst it may not have been appropriate to include information about the development in the sales particulars (given that it was at the proposal stage), it should have been divulged to Mr and Miss B’s prior to making their transactional decision to view the Property.