L&Q ‘Black Friday’ ads

Is it ok to promote shared ownership with Black Friday deals?

We weren’t impressed to discover L&Q promoting shared ownership with the slogan ‘Black Friday the Shared Ownership Way’.

We contacted the Advertising Standards Authority, who upheld our complaint. You can read their ruling here. The advertising watchdog said that Black Friday deals commonly applied to consumer goods and that they were associated with impulsive purchases on low-risk items. They agreed that this Black Friday marketing was inappropriate for what is likely to be the most expensive purchase most households will ever make.

The full text of Shared Ownership Resources’ complaint to the ASA follows.

My complaint is that the L&Q ‘Black Friday’ marketing campaign breaches the following CAP Code rules:

1.3 Marketing communications must be prepared with a sense of responsibility to consumers and to society.

3.1 Marketing communications must not materially mislead or be likely to do so.

1.9 Marketers should deal fairly with consumers.

The campaign is delivered via various platforms including London Underground posters, Facebook and the L&Q website.

1.3 Marketing communications must be prepared with a sense of responsibility to consumers and to society

‘Black Friday’ is an annual event to encourage mass retail spending on products such as TVs, mobile phones, kitchen appliances and beauty products. To promote homebuying – one of the most expensive transactions most people will ever undertake – by utilising a marketing slogan associated with inexpensive retail items trivialises the purchase.

In practice – ‘affordable homes’ claims notwithstanding – shared ownership constitutes a complex and risky product (as evidenced, for example, in research published by the University of York’s Centre for Housing Policy in October 2022: Do Affordable Homeownership Schemes Reduce Homeownership Risks for Lower Income Households in England?).

3.1 Marketing communications must not materially mislead or be likely to do so

It is a trope of the housing association sector to claim that solicitors are responsible for explaining potential costs and risks.

However, by signposting homebuyers towards a page on the L&Q website (lqhomes.com/offers/) enabling them to search for shared ownership properties for sale, the advertisements go beyond merely introducing the concept of shared ownership and are likely to influence consumers’ decisions. It is therefore incumbent on L&Q to ensure that material risks associated with shared ownership, which would not exist for those purchasing a property outright, are made clear when promoting the tenure. Yet there is no reference at all to risk in the London Underground posters, on the Facebook post or on the L&Q Offers page.

The L&Q website does include a page with the heading Read our complete guide to Shared Ownership’ However, this page uses ‘part buy, part rent’ terminology alongside a description of L&Q shared owners as ‘owner-leasers’ which appears to be non-compliant with a previous ASA ruling published on 21 September 2022.

(The same L&Q page – under the heading ‘What are the disadvantages of shared ownership’ does explain that: ‘you are still a tenant and therefore need to ensure rent payments happen on time or risk eviction’. However, using the term ‘owner-leaser’ in addition to ‘tenant’ creates ambiguity and is consequently misleading).

1.9 Marketers should deal fairly with consumers

Fairness is of particular significance to shared ownership marketing. The tenure is a publicly subsidised ‘affordable homes’ scheme and, as such, the Government claims ‘fairness’ to be one of its qualities.

Yet the published terms and conditions for L&Q ‘Black Friday’ incentives require homebuyers to: pay a reservation fee of £99 which has a ‘cooling off’ period of just 2 days (and only then if the legal pack has not been sent) and is non-refundable after 22 days; to raise all enquiries within a mere 11-21 days of paying a reservation fee; and to exchange contracts within 28 days of a legal pack being issued. In addition, the various incentives – the reduced reservation fee, the £500 John Lewis E-Voucher, and the contributions towards buying costs or legal fees are not available unless the homebuyer instructs a solicitor and mortgage broker from L&Q’s panel.

Whilst use of panel professionals might facilitate meeting such short deadlines, it raises uncomfortable questions as to whether the imposition of a 28-day deadline in the first place, alongside a requirement to use L&Q’s favoured professionals in order to access advertised incentives, constitutes fair dealing with consumers.

By way of comparison, the New Homes Quality Board (NHQB) Code of Practice (from which shared ownership is currently excluded) requires a mandatory 14 calendar days cooling off period, and that exchange of contracts must be not less than not less than six weeks after reservation unless the customer requests an earlier date.

Submitting a complaint to the ASA

Are you concerned about shared ownership ads you’ve seen? You can submit online complaints to the ASA here.