Property Ombudsman Christopher Hamer has called for the next Government to quickly regulate letting agents for the protection of the tenants and landlords who use them.
Mr Hamer revealed in his most recent annual report that disputes with letting agents had increased from 28% to 49% of his workload during 2009. Problems with sales agents therefore dropped to only 51% of his total. He added that he expected problems with lettings to constitute two thirds of his work load this year. It is thought that regulation would be all the more important given the continued low property sales figures that are continuing to lead homeowners to become ‘accidental landlords’, renting their properties out after failing to sell them.
Mr Hamer commented: “In the meantime, my message to any landlord or prospective tenant is to ensure that they use an agent who is a member of a recognised trade association or any agent who is a member of The Property Ombudsman scheme. Such firms will therefore be adhering to the TPO Code of Practice. In the absence of any formal regulation, my Code lays down the standards by which firms should conduct their business.”
Mr Hamer lamented “the alarming inconsistency” of letting agents not being covered by the provisions of the Consumers, Estate Agents and Redress Act, the legislation that forced every one of the UK’s residential sales agents to register with an approved redress scheme, leading over 90% of UK estate agents to become members of TPO.
“Whilst many agents in the lettings business (a total of 2,241 companies with 7,200 offices at the end of 2009, and the numbers are growing) are in TPO membership and have shown that they want to apply high standards in all aspects of their business and afford dissatisfied consumers access to independent resolution of the matter through the TPO, there are still many firms operating under their own interpretation of what are appropriate standards.”
Despite a 45% increase in the lettings workload from 300 cases to 435, there was actually an overall 15% decline in TPO’s workload for the period due simply to the lack of referred sales disputes, which Mr Hamer regarded as “perhaps inevitable… given the market conditions over the past year.”
The disputes themselves were also generally less serious, as reflected in the average compensation award dropping from £666 in 2008 to £339 last year.
“As we stand at the moment, the need to develop the approach to customer service, to ‘up the game’ in terms of treatment of customers, is on the lettings side [rather than the sales agents’ side].” A quote from Property Quote Direct.