By regulating the information requirements and the advertising of real estate, as well as the minimum elements of the contracts, NOM-247 intends to give greater protection to consumers of real estate and related services, before real estate, developers, construction companies, promoters and other actors in the sector.
This standard was issued on March 22, 2022 and entered into force on September 18, 2022.
This NOM is applicable to providers who are developers, builders, developers, and any person involved in advising and selling real estate to the public for residences, including brokers, internet pages, or others. The following is understood by supplier, installer, builder and promoter:
Provider: is the natural or legal person, in terms of the Federal Civil Code and article 2 section II of the LFPC, who habitually or periodically offers, distributes or sells homes or land exclusively for the use of a home.
Fractionator: the natural or legal person who habitually or periodically is dedicated to segmenting real estate for housing, which will also have the quality of Provider.
Builder: the natural or legal person in charge of executing the work in accordance with the executive project authorized by the competent authority, which will also have the quality of Supplier.
Promoter: the natural or legal person, dependent or authorized by the Supplier or Sales Concessionaire, who periodically or habitually engages in the economic activity of promoting the sale of real estate for residential use, which will also be recognized as Supplier. Real estate brokers fall within this definition.
Although it is a good attempt to regulate the sale of real estate and thus give greater protection to consumers, there are still certain gaps in its interpretation, which should be adjusted and improved over time, such as the fact that the NOM-247 is applicable to individuals who intend to sell a property, since they do not regularly do so.
Some of the obligations that Suppliers have under NOM-247 are the following:
Advertising: This item could be the most relevant for real estate brokers. In accordance with NOM-247, Suppliers must reflect in advertising (in the channels that apply such as internet pages, classifieds, among others) in the clearest way possible, what is related to the sale price of the property and the clarification regarding to the credits, as well as the expenses that are included and which are not, such as closing costs, brokerage commissions or notary expenses. On the other hand, the images and information of the properties that are used must not incite confusion.
Data Protection: Comply with the provisions of the Federal Law on Protection of Data Held by Private Parties and NOM-247 itself in terms of privacy and protection of personal data.
Reception of Amounts: Regulate the way in which payments are made, including advances and down payments, as well as the way in which they are returned to the consumer, if applicable.
Contracts: those that regulate the relationships established under NOM-247 must comply with the provisions of NOM-247 itself, including promise-to-purchase, pre-sale, and purchase-sale contracts for residential property, land, and intermediation contracts for the purchase and sale of real estate intended for housing. Likewise, said contracts must be registered with the Federal Consumer Attorney's Office.
Bill of Rights: Suppliers must provide consumers with a bill of consumer rights, which must comply with the provisions of NOM-247 itself.
In the same way, the Supplier must make known and respect the prices, rates, guarantees, quantities, qualities, measurements, interests, in the case of credits, charges, terms, restrictions, deadlines, dates, modalities, reservations and other applicable conditions. in the properties that it offers and markets, letting the consumer know about the legal status of the property.
NOM-247 establishes that if some of the obligations are not met, compensation, payment of damages or a possible bonus to the consumer can be established; Yes However, it does not establish how much these can amount to.
Sanctions are imposed in accordance with non-compliance with NOM-247 and other applicable regulations, imposed based on certain criteria analyzed by the authority, including economic capacity. According to the newspaper El Economista, PROFECO has already started with compliance inspections and some sanctions have already been applied that have ranged from 600,000 pesos to 1,600,000 pesos.
The authority considers that NOM-247 is applicable to both new and existing properties, which are not sold by construction companies but by individuals. The foregoing is contradictory to the definition of Provider established in NOM-247 itself and could lead the parties to agree without considering the Developer or Real Estate Broker, even when they have been presented by the latter.
The direction taken by the application of NOM-247 will remain to be seen, since there are still some gaps in terms of its interpretation, however, Real Estate Brokers and in general the actors of the real estate industry must protect the interests of consumers by providing information truthfully and in as much detail as possible.
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Any questions or comments in this regard I place myself at your service at Graham Abogados.
Graham Abogados is a law firm specializing in real estate, stock market and transactional matters including mergers and acquisitions and corporate financing. Our attorneys have participated in and structured sophisticated transactions, advising various financial institutions and investors. We have the knowledge and experience necessary to propose appropriate solutions to the needs and objectives of our clients and their operations.
By: Carlos Martínez Arizpe Gudiño Graham Abogados, S.C. - Adviser Tel: 55 8910 1350 / cmartinez@grahamabogados.mx
