High end estate agent Hamptons has had its knuckled rapped by the advertising regulator about the way it displays fees in an advert.
The Advertising Standards Authority (ASA) received a complaint about an online advert which said: “£1,200 per Calendar Month + £216 incl VAT admin fee per property + other fees may apply".
The text "+ £216 incl VAT admin fee per property + other fees may apply" was hyperlinked to further details about related fees.
The complainant, who understood that it would not have been possible to rent the property without paying additional fees, challenged whether information about non-optional fees was sufficiently clear.
Responding, Hamptons said the administration fee was the only fixed charge. It pointed out that there was a statement on each property listing that stated "+ £216 incl VAT admin fee per property + other fees may apply", which was hyperlinked to a PDF document entitled "Charges and Information for Tenants".
It said the document provided further details about other mandatory charges that might apply, including charges for obtaining references for the applicant.
The document also stated "other charges may be incurred as part of the application process", which referred to check-in fees. It explained the check-in fee would vary from property to property, depending on the size and the charge levied by the independent inventory clerk, of which Hamptons were paid a percentage.
It said there was a different fee structure for their Bristol branch. It applied an all-inclusive fee, combining the administration fee, referencing fee and check-in fee, which was the greatest of either 35% of the first months' rent or £420. It said they would amend the document, providing details of the check-in fees on the first page.
The complaint was upheld by the ASA as it breached CAP Code (Edition 12) rules 3.1 and 3.3 (Misleading advertising), 3.17, 3.18 and 3.19 (Prices). The ASA told Hamptons the ad must not appear again in its current form.
In a ruling the ASA said: “The ASA considered consumers would interpret the claim "+£216 incl VAT admin fee per property + other fees may apply" to mean that the administration fee was the only non-optional charge and there might be other fees depending on the situation.
“However, we understood that there were other non-optional fees that consumers would have to pay if they rented the property. These fees were a referencing charge and a check-in charge, which would be combined with the administrative charge into an all-inclusive fee for their Bristol branch.
“For other branches, the referencing charge was one of two fixed prices depending on whether the consumer was a tenant or a business, and the check-in charge varied depending on the size of the property.
“We noted CAP Code rule 3.19 stated "If a tax, duty, fee or charge cannot be calculated in advance, for example, because it depends on the consumer's circumstances, the marketing communication must make clear that it is excluded from the advertised price and state how it is calculated".
“While we acknowledged details of the costs were included in a document which was hyperlinked to the claim, we considered non-optional fees were material information that was likely to have an impact on a consumer's transactional decision. We considered, therefore, that the information about the non-optional fees was not sufficiently prominent. Because the ad misleadingly implied other fees might not apply, and the information about non-optional fees was not sufficiently prominent, we concluded the ad was misleading.”
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