Ad description
A page entitled "Part Exchange" on the website www.dwh.co.uk, promoting a property development company, stated in large print "We could be your buyer, offering you 100% market value for your current property, the average of two independent valuations". Text beneath stated "... We could buy your existing house from you, for 100% of its market value* ..." and "... We could buy your home, paying 100% of its market value*...". Text in small print at the bottom of the page stated "*David Wilson obtains two independent valuations and to ensure 100% market value, any offer made matches the average of these".
Issue
The complainant, who did not believe that they were offered the true market value for their home, challenged whether the claims to offer "100% market value" were misleading and could be substantiated.
Response
BDW Trading Ltd, t/a David Wilson Homes said there was no industry definition of the term "100% market value", nor was there a clear customer perception of what that meant. However, the definition they used for their advertising of the part exchange scheme was the average of two independent valuations of the property based on a sale within eight to ten weeks, and this was clearly set out in the terms and conditions on their website. The complainant reported having obtained their own valuations from estate agents which were higher than the offer they had received from David Wilson Homes. In response to that point, David Wilson Homes stated that they believed the estate agents were likely to have put forward proposed asking prices for the property rather than valuations, and that the asking price of a property was inevitably higher than its value.
They said the large print beneath the headline "Part Exchange" referred to "100% market value ... the average of two independent valuations". Further text in the ad contained asterisks next to each version of the claim "100% market value" which linked to the statement at the bottom of the page "*David Wilson Homes obtains two independent valuations to ensure 100% market value, and offer matches the average of these". They considered that this made clear that any offer made to a customer would be based on valuations that they obtained, rather than any valuations the customer may already have received. They further noted that the ad referred to the fact that they "could" be the buyer for the customer's home. They said the use of the word "could" was important, as it made clear that the part exchange scheme was not available to all purchasers and that there were conditions attached. They noted that further down the web page the consumer was directed to the terms and conditions for the offer, which included the text "We will appoint two independent valuers to value your home on the basis of a sale within 8 to 10 weeks. Any part exchange value offered by us will be the average of those two market valuations ...". David Wilson Homes supplied examples of the valuations they had obtained for properties and the resulting offers they had made to the owners, which demonstrated a practice of obtaining two valuations and offering an average of those.
They noted that in some cases the valuation form included a price for both the "market value including fixtures and fittings" and a lower price under the description "expected offer within 8-10 weeks", the latter of which had been used in their own calculation of the offer to be made to the customer. They said they believed the higher figure for the "market value including fixtures and fittings" was likely to be based on the figure likely to be achievable if the property was placed on the open market for a longer period. They said their part-exchange scheme offered several advantages to customers, including that they were able to move house relatively quickly.
Assessment
Upheld
The ASA acknowledged that the meaning of the term "100% market value" was open to interpretation, and for that reason considered that marketers using the phrase should ensure they made clear in their ads how they would determine the market value of the property. We noted that prominent text in the ad stated "We could be your buyer, offering you 100% market value for your current property, the average of two independent valuations", and that further references to the term "100% market value" in the ad were linked by an asterisk to text explaining that offers would match the average of two independent valuations obtained by David Wilson Homes. We therefore considered that the relevance of the two independent valuations to the term "100% market value" was sufficiently clear to consumers. We noted that the documentation supplied by David Wilson Homes demonstrated a practice of obtaining two valuations and offering an average of those two figures.
We noted, however, that in each case the valuers were instructed by David Wilson Homes to value each property on the basis of achieving a sale within eight to ten weeks. In some cases, the valuer had also given a separate, higher, figure for the "market value" of the home including fixtures and fittings, but without specifying a timeframe for the sale. We understood that the stipulation of an eight- to ten-week sale period could negatively impact upon the price a property would achieve. Although we considered that it was reasonable for David Wilson Homes to calculate their offer from the average of two valuations based on a sale within eight to ten weeks, we considered that that was significant information which should be clearly stated in order to clarify the meaning applied to the term "100% market value". We acknowledged that the valuations, which were based on sales within that time period, were made clear in the terms and conditions for the part exchange offer, one click away from the ad. However, we considered that it was material information which needed to be stated within the ad itself. Because it was not, we concluded that the claims to offer "100% market value" were misleading.
The ad breached CAP Code (Edition 12) rules
3.1
3.1
Marketing communications must not materially mislead or be likely to do so.
and
3.3
3.3
Marketing communications must not mislead the consumer by omitting material information. They must not mislead by hiding material information or presenting it in an unclear, unintelligible, ambiguous or untimely manner.
Material information is information that the consumer needs to make informed decisions in relation to a product. Whether the omission or presentation of material information is likely to mislead the consumer depends on the context, the medium and, if the medium of the marketing communication is constrained by time or space, the measures that the marketer takes to make that information available to the consumer by other means.
(Misleading advertising),
3.7
3.7
Before distributing or submitting a marketing communication for publication, marketers must hold documentary evidence to prove claims that consumers are likely to regard as objective and that are capable of objective substantiation. The ASA may regard claims as misleading in the absence of adequate substantiation.
(Substantiation) and
3.9
3.9
Marketing communications must state significant limitations and qualifications. Qualifications may clarify but must not contradict the claims that they qualify.
(Qualification).
Action
The ad must not appear again in its current form. We told David Wilson Homes to ensure that they made clear how they determined the "market value" of the property in their ads.
