Lords tell UK Government to get on with agent regulation

Following a short inquiry, at which Propertymark gave evidence, the House of Lords Industry and Regulators Committee has bluntly asked the UK Government why it has not yet established a regulator of property agents, four years after it committed to doing so.

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In a detailed letter to the Secretary of State for Levelling Up, Housing and Communities, the Rt Hon Micheal Gove, MP, the Committee chair, Baroness Taylor of Bolton, laid out the near-unanimous evidence from consumers and industry bodies on the need for statutory regulation of property agents.  In the meantime, the impact of poor regulation is being felt by tenants and leaseholders.

A response from the UK Government to the conclusions and recommendations has been requested by 26 April 2024.

The sector has been left in limbo

The Committee found that a new regulator would make a significant difference by driving up standards in the sector and proactively enforcing against agents who engage in bad practices.

They echoed evidence given by Timothy Douglas, Propertymark’s Head of Policy and Campaigns, stating that current forms of enforcement and redress are reactive and limited in scope. We have lobbied extensively in favour of an effective regulatory regime that can enforce an industry code of practice that improves the customer experience.

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05 Mar 2024
A step closer to the regulation of property agents

All agents should have minimum qualifications

Proposals for mandatory qualifications for property agents carrying out reserved activities have been supported by the Committee. They also recommend that key skills should include dealing ethically with consumers, including vulnerable consumers, alongside the necessary technical requirements for functions.

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Propertymark’s long-held position is that without minimum entry requirements to practice, consumers are potentially dealing with someone who does not understand the technicalities involved in buying, selling, and renting property or understand how to analyse the level of risk to their business.

Ensuring agents are suitably qualified and meet minimum competency standards is an essential factor in driving up standards of service for consumers and eliminating bad practices in the sector.

An important role for professional bodies

Professional bodies are already demonstrating good practice, and this must be built upon, co-ordinated and enforced, with those who don’t comply removed from the sector and prevented from operating.

Once a regulator is established, Propertymark and other professional organisations will need to continue to support their members to be properly qualified and to comply with codes of practice.

The Committee highlighted the case for delegating some regulatory activities to professional bodies, particularly concerning qualifications and training, to reduce duplication and additional costs.

Approve a single Ombudsman for property agents

It was recognised that the two existing redress schemes compete to attract agents, which potentially undermines their focus on customers as well as resulting in inconsistent standards across the industry.

Propertymark reiterated this message in a recent meeting with the Housing Minister, Jacob Young, MP, explaining that The Property Ombudsman and the Property Redress Scheme currently do not operate to the same criteria or adjudicate against members in the same way, which leads to inconsistencies in agent complaint procedures and a lack of clarity for consumers.

The UK Government should set out plans to approve a single ombudsman or redress scheme for all property agents which is a key recommendation by the Committee.

Propertymark campaigning

Regulation has always been a key campaign area for Propertymark and its members, who support the introduction of mandatory requirements for letting agents in England and for sales agents across the UK.

Propertymark was part of the RoPA Working Group which published its report in 2019. Since then, the current Conservative UK Government has not responded or outlined whether it continues to believe that property agents should be regulated.

The current Housing Minister’s recent answer to a written question on the topic did not say whether they are even still under consideration.

Matthew Pennycook MP, Shadow Housing Minister said that a future Labour government would look to introduce the recommendations in Lord Best’s report to regulate property agents

Propertymark welcomes the Committee’s findings and its recommendations for greater regulation of property agents. The inquiry highlights the importance of regulation and the need to improve consumer protection. It has also clarified the vital role that professional bodies currently play in providing qualifications and ensuring compliance with rules and regulations as well as taking action to drive up standards across the property sector.

As Propertymark made clear through the evidence provided to the Committee, it is vital that mandatory qualifications, a statutory code of practice and regulatory oversight exist through a new regulator to ensure compliance with new and impending legislation.

The UK Government must not miss the opportunity to act on the recommendations of the Regulation of Property Agents Working Group and build greater protections for consumers. Recent and proposed pieces of legislation for leasehold, renting and building safety are complex and need to be accompanied by overarching regulation that supports and promotes competent and professional property agents.

Timothy Douglas
Timothy Douglas Head of Policy and Campaigns | Propertymark
Download a copy of the letter