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spyguy

Will Civil Claims Bankrupt Foxtons, Countrywide And Lsl?

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Saw this today:

And then they came for the estate agents

http://ftalphaville.ft.com/2013/12/02/1707522/and-then-they-came-for-the-estate-agents/

'He sees widespread bad practice that at a minimum, could prompt the Office for Fair trading to step in and demand changes that would eat into profits. Or in the worst case, that the listed agencies could be exposed to a deluge of civil claims from customers who have been misled for years, threatening balance sheets long on intangible

goodwill'

Links to this blog post from October:

http://anjaliszt.blogspot.co.uk/2013/10/will-civil-claims-bankrupt-foxtons.html

'Most estate agents charge opaque additional fees to tenants and landlords; most charge opaque renewal commissions to landlords; and most opaquely quote fees and commissions exclusive of VAT (and without disclosing the applicable rate of VAT which was acceptable until 2008 in some circumstances). They have done so for many years. All three practices are prohibited by the Consumer Protection from Unfair Trading Regulations 2008 (CPUTRs) and, before that, by the Consumer Protection Act 1987 (CPA).

The Office of Fair Trading (OFT) has recently published several reports and guidance documents much of which the industry continues to ignore. If the OFT takes action, and it must to retain a semblance of authority, most estate agents are at risk of criminal prosecution, most are at risk of loss of the large proportions of their revenues that rely on opaque pricing, and most are at risk of negative publicity. Negative publicity would severely damage the goodwill upon which their balance sheets and revenues rely, and provoke thousands of civil claims for amounts improperly charged over the past six years or, as in the case of PPI mis-selling, fifteen.'

There's a lot of lawyers kicking their heels at the mo,What with the PI fun ended and legal Aid being slashed.

Edited by spyguy

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I wonder if Anja Liszt has a massive short position?

The blog has been set up recently and is very well researched.

Edited by spyguy

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Wonder who underwrites EA idemnity insurance?

I don't say this often but this looks like massive problem for EAs.

15 year life on civil claims. Oh dear.

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Word is one of the big Northern Ireland EAs/commercial firms is trying to get one of the English big boys to buy them over. There a large number of claims against their professional indemnity insurance for over valuation, negligence etc during the boom. The excess on the mounting claims is too much.

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Will this affect Burton's share price as demand for polyester pin stripe suits plummets?

Edited by Si1

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There are no formal qualifications for an EA. Same goes for bankers and politicians.

It will be pretty hard to hold any organisation that's made both the treasury and bankers flush with fees and taxes responsible for any perceived misdeeds.

It's not like taking on a few hundred thousand pounds of debt is a life changer requiring licence, such as is for a nurse, a taxi driver or even a child minder.

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What goodwill? Everyone I know thinks being an Estate Agent is perhaps one of the most toxic professions in the country.

The whole business of renting, buying and selling houses is like the Wild West though with no-one looking out of the actual buyer/renter. All the other participants either seem to be out to screw you or cover their ass - often both at the same time.

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They'll be trying to charge viewing fees next.

Of the dealings I've had with (4 or 5 different) estate agents over the past 6 months, most don't seem to want my business as a buyer. They rarely return phone calls or emails and when they promise to send details after viewing a property, they just don't bother.

Britain is supposed to be a nation of merchants, but the service they give is shite.

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I doubt that anything will come of it. If they have been breaking the law for years then the OFT could have done something years ago. Since the government loves big business especially ones linked to property they would not let anything happen to these companies.

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The EAs can still buy pin stripe suits from Burtons without wages. If unemployed, you can get a suit, but you must purchase it from Burtons.

Indeed. I was in the local Burton's a wile back and a guy who was filling in a credit application did not know his own age. He got the instant credit.

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The repeated charging of high fees when the same person is staying in the property seems unfair on both landlord and tenant.

nonsense, they have severe photocopying costs to endure.

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Saw this today:

And then they came for the estate agents

http://ftalphaville.ft.com/2013/12/02/1707522/and-then-they-came-for-the-estate-agents/

'He sees widespread bad practice that at a minimum, could prompt the Office for Fair trading to step in and demand changes that would eat into profits. Or in the worst case, that the listed agencies could be exposed to a deluge of civil claims from customers who have been misled for years, threatening balance sheets long on intangible

goodwill'

Links to this blog post from October:

http://anjaliszt.blogspot.co.uk/2013/10/will-civil-claims-bankrupt-foxtons.html

'Most estate agents charge opaque additional fees to tenants and landlords; most charge opaque renewal commissions to landlords; and most opaquely quote fees and commissions exclusive of VAT (and without disclosing the applicable rate of VAT which was acceptable until 2008 in some circumstances). They have done so for many years. All three practices are prohibited by the Consumer Protection from Unfair Trading Regulations 2008 (CPUTRs) and, before that, by the Consumer Protection Act 1987 (CPA).

The Office of Fair Trading (OFT) has recently published several reports and guidance documents much of which the industry continues to ignore. If the OFT takes action, and it must to retain a semblance of authority, most estate agents are at risk of criminal prosecution, most are at risk of loss of the large proportions of their revenues that rely on opaque pricing, and most are at risk of negative publicity. Negative publicity would severely damage the goodwill upon which their balance sheets and revenues rely, and provoke thousands of civil claims for amounts improperly charged over the past six years or, as in the case of PPI mis-selling, fifteen.'

There's a lot of lawyers kicking their heels at the mo,What with the PI fun ended and legal Aid being slashed.

This is why most tenants and landlords I know don't use estate agents if at all possible. Absolutely useless, lazy and charge a fortune!

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Here's an update: Foxtons's trousers part company with its mouth.

Foxtons actions demonstrate that it has accepted my criticisms, and make it, amazingly, one of the most compliant agencies in the industry, but I doubt that its ludicrous fees will survive transparent price competition for long. If not, its profit margins will be badly hit. And then there is the potential for civil claims for misleading conduct in the past..

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Here's an update: Foxtons's trousers part company with its mouth.

Foxtons actions demonstrate that it has accepted my criticisms, and make it, amazingly, one of the most compliant agencies in the industry, but I doubt that its ludicrous fees will survive transparent price competition for long. If not, its profit margins will be badly hit. And then there is the potential for civil claims for misleading conduct in the past..

Good website.

Good results.

Hope you did not mind me reposting the link of he link of the link . . . .

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Here's an update: Foxtons's trousers part company with its mouth.

Foxtons actions demonstrate that it has accepted my criticisms, and make it, amazingly, one of the most compliant agencies in the industry, but I doubt that its ludicrous fees will survive transparent price competition for long. If not, its profit margins will be badly hit. And then there is the potential for civil claims for misleading conduct in the past..

Where the hell have you been? HPC is your natural habitat! Nice work.

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Great work Anje!

That's a MUST READ for anyone who rents, basically thousands of pounds paid in 'hidden' or illegal charges could be recoverable from these vultures.

I think this has the potential to get really 'big', I can't see how they are not bang to rights breaking the law, and if claims can go back 15 years - ouch!

Really well written too, it's nice to read a well structured, well researched article for a change - puts the mainstream news media to shame. It also shows how pathetic and inept (and corrupt?) the so called 'regulators', ombudsmen, trading standards, OFT etc etc etc all are - this has obviously been going on for decades, it's clearly illegal, they know full well it's going on AND who's doing it ...yet nothing but handwringing and review this and draft that and formal requests to please not do this or that - total waste of space / public money (as per usual).

I'm going to check my tennancy agreement and see what illegal stuff I was charged for, and will henceforth tell the letting agency to poke any renewal or check out fees.

Anyone on here had any dealings with this property ombudsman? - I might fire off an email seeking some clarification on some of these issues.

Keep up the good work and keep us posted - be very interesting how this all unfolds.

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