Government seeks views for crackdown on unfair agents

The Department for Communities & Local Government has today (18th October) launched a call for evidence to inform proposals to protect consumers in the letting and managing agent market.

The call for evidence follows a previous consultation on tackling unfair practices in the leasehold market, and the Communities Secretary Sajid Javid’s announcements at the Conservative Party Conference earlier this month, including:

- Taking forward the draft Bill to ban letting fees paid by tenants;
- That all lettings agents will be regulated; and
- That all landlords will have to be covered by a redress scheme.

This call for evidence covers all managing and lettings services by property agents in the private rented and leasehold sectors.

There is considerable overlap between the leasehold and private rented sectors. With 43% of leasehold properties being in the private rented sector it is likely that property agents will be providing both letting agents’ services and property management in the private rented and leasehold sectors.

The Government will consider changing the law so that all letting and management agents, across both the private rented and leasehold sectors, must be qualified and regulated in order to practice.

a. The call for evidence explores different potential models of regulation and believes that there are broadly three ways that this could be achieved:
Requiring all letting agents and managing agents to be members of a relevant professional body (such as UKALA, ARLA or ARMA). This would require professional bodies or organisations to be approved by Government, possibly operating to one Code of Conduct.

b. As above, but with oversight from a regulatory body, established or approved by Government.

c. Government establishing or approving a new regulatory body, which agents are required to sign up to. Membership of a professional body would be optional but lower entry fees could apply to agents that are members of an existing body.

Other measures to be considered as part of the call for evidence include:

- How consumers can be empowered in the market, including whether leaseholder tenants should have a greater say over the appointment of managing agents;
- How transparency can be increased in the system so that tenants and leaseholders know what they are being charged for and why;
Ensuring fairness and openness around relations between freeholders and agents.

The call for evidence will run until 29 November 2017. Government will bring forward detailed proposals early next year.

For more information, visit www.landlords.org.uk

This is supposed to be the age of the empowered consumer – yet in property management, we’re still living in the past. Today we are showing our determination to give power back to consumers so they have the service they expect and deserve, as part of my drive to deliver transparency and fairness for the growing number of renters and leaseholders. Our proposed changes to regulate the industry will give landlords, renters and leaseholders the confidence they need to know that their agents must comply with the rules.

Communities Secretary Sajid Javid

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