I, for one, am actually quite pleased to see that the OFT is launching an investigation into some sale-and-rent-back-firms. These firms offer a scheme where the home owner sells their home at a discount in exchange for tenancy rights.
It is not because I think these types of schemes are inherently bad, on the contrary, they may have great potential, but I feel it is very important they are well regulated.
According to James Meikle of the Guardian, the OFT is taking steps to make sure this happens. The watchdog organisation has issued 16 companies with please explain notices regarding their advertising practices.
There is some concern that these companies may have been misleading people who are in desperate financial straits and scared they are going to lose their homes.
The OFT has given the 16 companies, who have not been named at this stage, fourteen days to substantiate the claims they have made in their advertising or face sanctions that may include prosecution.
Late last year the OFT recommended that this sector (known as the ‘flash sales’ sector) be obligated to be more transparent about such things as valuation of the property and tenancy terms.
a
This seems only right to me and I will be waiting with interest to see the outcome of this particular battle. I will, of course, update you when I hear anything.
