Online estate agent’s ads declared misleading

Online estate agent’s ads declared misleading

A website and TV ad for HouseSimple, an online estate agent, have been criticised by the Advertising Standards Authority (ASA) for making unsubstantiated claims.

The website, seen in February 2017, stated on its “Estate Agent Fees explained” page that “High street estate agent fees are usually worked out as a percentage of the final sale price of your property. This can range from 1.5% to 4% (plus 20% VAT – which often isn’t clearly highlighted as an extra cost), adding up to an average bill of £5,247” and that online estate agents were “much cheaper”.

A TV ad, seen on 14 March 2017, stated in the voice-over that “Get an expert evaluation, professional photos and floor plans … just like a traditional estate agent … but the big difference, HouseSimple customers saved on average £5,000 in fees.” Text at the bottom of the screen stated “Based on responses of 391 previous HouseSimple customers surveyed.”

The ASA received two complaints. One complainant, who believed that the average estate agent fee was 1.3%, challenged whether the claim “1.5% to 4%” in the website ad was misleading and could be substantiated. Both complainants challenged whether the savings claims in both ads were misleading and could be substantiated.

The ad watchdog concluded that the claim that high street estate agent fees ranged “from 1.5% to 4%” (plus VAT) was misleading and had not been substantiated. On this point the ad breached CAP Code (Edition 12) rules 3.1 (Misleading advertising), 3.7 (Substantiation) and 3.33 (Comparisons with identifiable competitors).

In addition, the ASA concluded that the savings claims in both ads misleading and had not been substantiated.

On this point, the website ad breached CAP Code (Edition 12) rules 3.1 (Misleading advertising), 3.7 (Substantiation) and 3.33 (Comparisons with identifiable competitors) and ad (b) breached BCAP Code rules 3.1 (Misleading advertising), 3.9 (Substantiation) and 3.33 (Comparisons with identifiable competitors).

The ads should not appear again in their current form. The ASA told HouseSimple Ltd to ensure that ads which made comparisons provided sufficient information about the services being compared to ensure that consumers would not be misled about either the advertised service or the competing service. The ASA also told them to ensure they held adequate evidence to substantiate the basis of comparative claims.