ASA Adjudication on Dubai Heaven On Earth Real Estate Ltd

Ad

Two ads in Urdu and English, for Dubai Heaven on Earth Developers, were broadcast on DM Digital TV. Both ads showed graphics of a skyscraper; English text and an Urdu voice-over. The first ad stated “Pay only 30K on a 60K apartment and let your tenants pay the rest. Easy customised payment plans. Earn rental returns of £24,000 pa. Guaranteed pre-approved loans. No documentation or credit checks required. Starting from only £25,000. For Details Call Now: UK 020 8xxx xxxx Dubai 00 971x xxx xxxx www.dubaiheavenonearth.com.”. The other ad stated “Marketing exclusively by Heaven On Earth Real Estate Brokers. Licensed by the Government of Dubai and Registered with the Chamber of Commerce. Now prelaunching Heaven Heights Tower. Become the owner from only £25,000. Luxury apartments, Preapproved finance, Freehold properties with tenancy schemes, Rental returns 12-15% p.a. For Details Call Now UK 020 8xxx xxxx Dubai 00 971x xxx xxxx www.dubaiheavenonearth.com.”.

Issue

Monitoring staff challenged whether:

1. "earn rental returns of £24,000 p.a." could be substantiated and the rental returns were consistently achievable;  

2.  the rental returns of £24,000 were available for apartments costing £25,000;

3. apartments were available for £25,000;

4. the rental returns of 12 - 15% referred to in the second ad were available;

5. the ads should have made clear that buyers were required to pay 50% of the purchase price as a down payment.

BCAP TV Code

Response

DM Digital TV did not comment but withdrew the ad when it was brought to their attention.

Heaven on Earth Developers (HOED) said they had noted that DM Digital TV's terms and conditions stated that all the campaigns had to be approved by them and must comply with the CAP (Broadcast) Advertising Standards Code.  So they had assumed that they could rely on DM Digital TV's clearance to ensure that the ads complied with the Code.  They acknowledged that the ad was unintentionally ambiguous and they said they would not broadcast the ads again in their present form.

1. & 4.  HOED submitted an e-mail from another property company. It stated that a comparative market analysis showed that the rental return for studio rentals in a waterfront property in Dubai was about £24,000 and they estimated that the rent for properties in the area around Bawadi should be at least £24,000 in 2011.  HOED added that the Sale and Purchase Rental Guarantee Terms and Conditions offered a rental guarantee of £24,000 for the first year.  

2.  HOED explained that the two sentences "earn rental returns of £24,000 pa" and "starting from only £25,000" were not consecutive and HOED believed that a reasonable viewer would not attribute the rental return of £24,000 to the cheapest apartments.

3.  HOED explained that they had wanted to convey that one could buy the cheapest apartment with an initial payment of £25,000, not that the apartments themselves were on sale for £25,000.  They believed that the second ad, which stated "become the owner from only £25,000", implied that the £25,000 was an initial down-payment.  They acknowledged that that it was unintentionally ambiguous.

5.  HOED believed that the sentence "pay only £30,000 on a £60,000 apartment and let your tenants pay the rest" made clear that 50% was required as a down-payment.

Assessment

1.  Upheld

The ASA noted the terms and conditions on HOEDs website contradicted the "Sale and Purchase Rental Guarantee Terms and Conditions" that HOED submitted and stated "with rental returns per annum/yearly in advance at basically no additional costs subject to standard Dubai rental property market".  We considered that, because the apartments were not due to be finished until October 2011, the Dubai property market might be significantly different by then. We noted the large number of resorts being built in the UAE.  Because we had not seen objective evidence to substantiate the claims "Earn Rental returns of £24,000 per annum" and because the website terms and conditions offered standard market-rate rental returns available in 2011 only, we considered that the advertisers had not substantiated the claimed rental return of £24,000 a year.  We considered that the first ad implied that the rental returns were available for several years but we noted that the "Sale and Purchase Rental Guarantee Terms and Conditions" promised them for only one year.  We concluded the ad was misleading.

The ad breached CAP (Broadcast) TV Advertising Standards Code rules 5.1 (Misleading advertising) and 5.2.1 (Evidence).

2. Upheld

From the "Sale and Purchase Rental Guarantee Terms and Conditions" that HOED submitted, we noted the offer was a limited special offer that guaranteed rental returns of about £12,000 for a studio, £17,000 for a one-bedroom apartment and £24,000 for a two-bedroom apartment for one year.  We understood that a studio was available from £69,999 and that the annual earnings of £24,000 were based on a two- or three-bed apartment that had a price of £109,999.  We considered that the first ad misleadingly implied annual rents of £24,000 applied to the apartment referred to in the ad as "starting from only £25,000".  

The ad breached CAP (Broadcast) TV Advertising Standards Code rules 5.1 (Misleading advertising) and 5.2.1 (Evidence).

3.  Upheld

We noted that, although the ads referred to apartments "from only £25,000", nothing was available for less than £50,000.  We considered that the ads were misleading.  

The ads breached CAP (Broadcast) TV Advertising Standards Code rules 5.1 (Misleading advertising) and 5.3.1 (Accurate pricing).

4. Upheld

We noted the second ad offered Rental returns 12-15% p.a" but the and Purchase Rental Guarantee Terms and Conditions" offered rental returns of only 11% for buyers applying after the launch date and only for three years.

The ad breached CAP (Broadcast) TV Advertising Standards Code rules 5.1 (Misleading advertising) and 5.2.1 (Evidence).

5.  Upheld

We understood that the buyer was responsible for paying 50% of the price of the apartment at the outset as a down payment.  We considered that the ads should have made that condition clear.

The ads breached CAP (Broadcast) TV Advertising Standards Code rules 5.1 (Misleading advertising).

Action

We concluded that the ads must not be shown again in their present form and that the product should not be advertised without adequate substantiation for the claims made for it.  

Adjudication of the ASA Council (Broadcast)