We need an independent review of shared ownership advertising, options to prevent mis-selling and an enforceable Code of Practice
Date: 5 June 2023
To: Guy Parker, CEO, Advertising Standards Authority
Cc: Department for Levelling Up, Housing and Communities; Levelling Up, Housing and Communities Committee; Homes England; Greater London Authority; and the Competition and Markets Authority
Dear Guy Parker,
Re: Shared ownership advertising
I am writing to inform you about a recommendation addressed to the Advertising Standards Authority (ASA) in a new report published by Shared Ownership Resources on 31 May 2023: Shared Ownership: The Consumer Perspective.
RECOMMENDATION: Government, Homes England, the Greater London Authority, the Competition and Markets Authority, the Advertising Standards Authority and the Committees of Advertising Practice should support an independent review into shared ownership marketing, consult on options to prevent mis-selling and deliver an enforceable Code of Practice for shared ownership marketing and promotion.
Shared Ownership: The Consumer Perspective (2023)
As National Trading Standards pointed out in 2021: ‘Buying or renting a home is one of the biggest purchasing decisions that a consumer will make in their lifetime‘. Yet many shared owners report feeling – with the benefit of hindsight – that they were misled by shared ownership advertisements.
In 2021 Shared Ownership Resources published a feature – Shared Ownership: Why we deserve greater transparency – citing concerns about ‘part buy, part rent’ terminology, a misleading lack of information about short leases, problematic affordability claims and whether the cross-subsidy model creates a conflict of interests which influences what is and isn’t disclosed in advertisements.
You will, of course, be aware that in 2022 the ASA upheld a complaint from Shared Ownership Resources about the national shared ownership campaign website sharedownership.net. The ASA ruled that:
- the claims ‘part buy, part rent’ and ‘it’s yours’ were misleading because they exaggerated the level of ownership attained by omitting material information on risks pertaining to the assured tenancy nature of shared ownership compared to full home ownership
- the campaign misleadingly omitted information related to the costs of extending a lease, particularly once there were under 80 years remaining
This followed on the heels of a 2019 ASA ruling which found a Notting Hill Genesis advertisement to be misleading.
In November 2022 the ASA published CAP Executive advice on advertising shared ownership properties. The advice reiterated a fundamental underlying principle of transparency.
‘Ads for shared ownership schemes should also make clear any material information that might affect a consumer’s decision to either partake in the scheme or simply to find out more’.
CAP Advice Online – Property: Shared Ownership
Yet, unfortunately, it appears that the ASA rulings on the national shared ownership marketing campaign and Notting Hill Genesis advertisement – and subsequent CAP advice – are being overlooked or ignored. ‘Part buy, part rent’ terminology continues to be pervasive in advertising by housing providers and their agents (with numerous examples provided in a 2022 Shared Ownership Resources feature: ASA say ‘part buy, part rent’ terminology is misleading). Indeed, Shared Ownership Week 2023 is currently advertising its event with exactly the same tagline as in the previous year: ‘Shared Ownership Week is your go-to place to learn about the part-buy, part-rent craze that everyone is talking about’.
Homebuyers may place trust in information conveyed via marketing content. This is, in part, because they are generally aware that shared ownership is a government-backed and publicly-subsidised affordable homes scheme delivered by housing associations who describe themselves as ‘charitable’ and ‘not-for-profit’.
However, shared ownership advertisements often over-simplify complexity by promoting benefits while understating hazards, This is particularly problematic given marketing campaigns are frequently positioned as an education tool, with homebuyers implicitly encouraged to place reliance on advertisements, advertorials and other online promotional resources including FAQs and online seminars
It is clearly welcome that the ASA have upheld two complaints about shared ownership advertising, and are currently investigating a complaint about a ‘Black Friday’ shared ownership promotion. Nonetheless, tackling non-compliance with consumer protection regulations and the CAP Code on an ad-by-ad basis is slow and ineffective given the multi-partner and multi-media context of contemporary shared ownership advertising. It is for this reason that the report Shared Ownership: The Consumer Perspective recommends that the ASA collaborate with other agencies to undertake an independent review into shared ownership marketing, consult on options to prevent mis-selling and deliver an enforceable Code of Practice.
Shared Ownership Resources was launched in March 2021. One of the aims of the platform is to provide greater clarity on complex issues to assist first-time buyers and shared owners in making informed decisions. I will therefore publish this ‘open letter’ on the website, and will likewise publish your response as and when it is received.
I would, of course, be pleased to discuss further the matters outlined in this letter, and look forward to your response.
Kind regards,
Sue Phillips
Founder, Shared Ownership Resources
Shared Ownership Resources was established in 2021 to champion the interests of shared owners and households considering shared ownership. The project publishes case studies, collaborates with housing, legal and financial experts to offer specialist information and advice; and campaigns for improved transparency and better outcomes and against mis-selling and other poor practices in the sector.
UPDATE: 26 June 2023
Shared Ownership Resources received an engaged response from the ASA. Further updates to follow in due course.
Unfortunately, as in all leasehold, the consumer is being duped and the various government bodies set up to protect people’s interests are incompetently looking on.