An easy way to regulate the lettings industry

Published 01/02/2012

By Mark Alexander, landlord and founder of Property118

Part of Landlords Log, Mark's Personal Blog

There has been a lot of discussion on Property118 in recent weeks about Letting Agents, regulation and trust issues. That’s hardly surprising given the number of reported instances of the closing down of Letting Agents whilst owing landlords rent and having failed to protect deposits. We have also witnessed an increasing level of debate surrounding the competence of agents.

The government have announced their intentions not to regulate the Lettings Industry and that has stirred up mixed reactions. Those in favour of regulation obviously include people who have lost money but also some Letting Agents would welcome regulation to put the cowboy operators out of business and get the market share they believe they deserve. On the flip side those opposing regulation are fearful of the costs and the impact on the industry based on the reality of what has happened since the FSA begun to regulate financial services. Now in my opinion that really is bureaucracy and red tape gone mad.

Why does regulating the Letting Industry need to be so complicated?

I take the point about ARLA bonding only protecting clients money but don’t their members also have to carry Professional Indemnity Insurance to indemnify themselves against negligence claims? I also accept the point on what happens if they subsequently lapse memberships and policies and I think statutory regulation with effective checks and balances is the only way to enforce against that scenario. Make bonding and professional indemnity insurance compulsory and that’s the problem sorted so far as I can see.

A bit of lateral thinking and a simple licencing scheme is all that would be required to regulate this. The rest would be down to market forces because if Letting Agents were incompetent their Professional Indemnity Insurance premiums would rocket as a result of claims. This would eventually close down those who don’t perform as they wouldn’t be able to renew their licences without proof of bonding and Professional Indemnity Insurance. I suspect insurers would also look to reward those who undertake recognised Continued Professional Development and get qualifications through discounts on PI insurance premiums.

It’s really that simple to regulate Letting Agents if you think about it. Three pieces of paper to check every year and it’s sorted. The Councils could raise revenue from the licencing and use Trading Standards to close down unlicensed operators. Another simple enforcement tool would be to make it illegal for the media (on and offline) to carry advertising for unlicensed operators.

What do you think?

I believe so strongly in this I’ve created an e-petition.

Please click here to sign the petition for compulsory licensing of Lettings Agents to protect Landlords and Tenants

About Mark Alexander
Mark and his family have been investing in property since 1989, initially in the Norwich area but more recently across the length and breadth of England. Mark created Property118.com as a social network for landlords with a vision of becoming the UK's largest online property community and the best respected property services directory and landlord news. Mark's experiences and strategies as a landlord are shared here Email - mark@property118.com

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86 Comments »

http://twitter.com/LandlordRef Landlord Referencing

At Landlord Referencing we totally agree Mark and also think that letting agents should be judged on how diligent they are at carrying out pre-tenancy protocol and awarded a star system, like hotels – so if you don’t carry out any referencing you receive no stars…?
We also believe that referencing should be compulsory as well, by carrying out both types of references; lifestyle and credit.
Any letting agent who isn’t carrying out a lifestyle reference is not doing the best for their landlord; how can they be?
Even today, an accreditation has joined us; which goes to show that even the council are concerned with problematic tenants.

http://www.property118.com/ Mark Alexander

I completely see where you are coming from Samii but the administration of a rating system creates an industry which in turn increases costs to agents which would unlimately be passed on to landlords and tenants. I much prefer a very simple linecing system. If an agent fails to do appropriate due diligence, including a lifestyle reference, there would be an opportunity for the landlord to claim against the agents PI insurance for any losses incurred as a result of the agents negligence. Everybody wins that way and best practice becomes the norm.

http://www.landlordlaw.co.uk Tessa Shepperson

Frankly anything which goes to protect landlords is good in my view. If a simpler scheme is more likley to be implemented then lets go for a simpler scheme. I do feel strongly though that ANYONE whose business involves holding on to large sums of other people’s money should be regulated in some way.

For example as a solicitor, even though my client account only has a small sum in it, I still have to get my accounts audited annually and my accountants have to do a report to the Solicitors Regulation Authority.

http://www.property118.com/ Mark Alexander

I totally agree Tessa, anybody handling money should be bonded and anybody providing advice should have PI. As a practicing solicitor I suspect it’s also compulsory for you to carry PI insurance and to pay into the solicitors compensation fund too? That’s what makes you a professional. Isn’t that the status all letting agents would like to have?

http://www.landlordlaw.co.uk Tessa Shepperson

Abolutely. I spend a small fortune every year on PI insurance, my practising certificate, accountancy fees, you name it!

Paul Barrett

Perhaps with your thorough knowledge of the issues concerning LA and LL and tenants etc; you could come up with an insurance bonding solution with appropriate terms and conditions which would give LL and tenants confidence in LA probity.

Anonymous

I come from a legal background – All lawyers need a practicing certificate – and incompetent or negligent ones are subject to a complaints procedure and can be struck off. Similarly, the law society sets out codes of practice which includes handling client money in separate accounts from office/overhead money.

Similarly, solicitors require PI insurance with an excess – and premiums do rocket if you have a claims past. This forces good practice and standards.We’ve got half a million pounds of landlord money coming into our coffers every month – So why on earth aren’t letting agents subject to the same rules as for example solicitors?We could easily run off with 3 month rent and live life of luxury on a south american coast.Agents also deal with a variety of aspects of law, relating to contract, health and safety, gas/electric, Town & Country Planning etc etc! How can somebody operate a business without any accreditation to confirm competence?For me, there should be a minimum requirement for qualification, such as NFOPP technical award for Arla, ARLA, or NALS/Safe Agent or similar membership and PI insurance and membership of the Ombudsman scheme for lettings.All of this is already in place – because it is not mandatory, many agents don’t join to save fees. The agents that go under and fleece landlords by and large fall into this category.If the agent was an Alra member, their Money Bonded Protection scheme would protect each landlord/tenant up to £25k per claim.
http://twitter.com/KnightPropertyM Knight Property Mgmt

Simple, effective, compulsory regulation can only be a good thing for the industry’s reputation. Sadly, even if the government was willing to act, its track record on such things is poor, and any scheme it introduced would almost certainly be a half-baked fiasco and a complete waste of taxpayers’ money. HIPS anyone?

I like your licencing idea though, Mark, and the idea of bad agents being priced out of the market by extortionate PI premiums. That’s so simple it could actually work!
http://www.property118.com/ Mark Alexander

To broaden this discussion here are some examples of where I think PI insurers could attract claims for the negligence where the actions or lack of action on the part of letting agents results in losses to landlords. Feel free to add to my list:-

1) Failing to complete adequate tenant referencing
2) Failing to advise landlords of statutory checks, e.g. Gas certificates, HMO licences etc.
3) Failing to advise landlords that they need adequate insurance for liability
4) Serving notices incorrectly
5) Illegal eviction
6) Failing to advise landlords on the benefits of obtaining and referencing guarantors
7) Failing to report complaints Failing to recommend Rent Guarantee Insurance
9) Failing to advise landlords of the deposit protection schemes available to them
10) Failing to advise landlords to commission a detailed and independent inventory
11) Failing to provide tenants and third parties with deposit protection certificates
12) Advertising a property to let without an EPC
13) Failing to obtain proof of identity for tenants
14) Failing to advise landlords of rent arrears in a timely manner and what their options are, e.g serving notices, claiming on RGI etc.
15) Failing to advise landlords of their legal obligations regarding tenant harassment and ‘peaceful enjoyment’

All of this is pretty obvious stuff to any good letting agents who will undoubtedly have a check list to ensure they do all of this anyway.

Paul Barrett

Blimey Mark if this was actually introduced half the LA would have to go out of business LOL!!!?

http://www.property118.com/ Mark Alexander

I’d feel a lot more confident in dealing with the survivers though, wouldn’t you? It would certainly take the guesswork and luck elements out of picking a good one

Mary Latham

I agree with your suggestion Mark but I’m sorry to say that it does not go far enough. BEFORE a person opens his doors as an Agent he should first know the business of those he has chosen to represent and many LA’s do not know the law or regulation and get landlords into big trouble. For me there are two issue
1. Financial considerations – which your idea would cover
2. Landlords liablity for mistakes made by LA who are working on their behalf.

It might soften the blow if a landlord could claim compensation from an Agent who had dropped him in it but it would not prevent the landlord being presecuted/loosing his fit and proper person status/upsetting his tenants/getting a bad reputation………..

I know some excellent LA’s but all are small private companies where the owner is involved on a day to day basis and has made it his/her business to know the law and regulation and to protect both the landlord and tenant from mistakes made through ignorance.

I would like to see your idea coupled with a minimum requirement to prove competance and continual professional development to ensure that their knowledge is always up to date

http://www.property118.com/ Mark Alexander

It’s probably an urban myth Mary but I’ve heard that there are more words in the FSA regulation of Financial Services than there are in the Bible and Koran combined and how many people have read let alone can recite both of those! I can see how easily this happens though as the wish list for regulation grows and grows. My suggestion is based on the real version of simplification, unlike the FSA’s pathetic attempts for achieve pensions simplification which quite frankly is a joke! The reality is that everything you have suggested would automatically fall into placed based purely on commercial forces affecting the simplistic structure I have recommended. For example, how long do you think it would take for PI insurers to realise that providing insurance to new operators with no formal qualification and experience results in more claims? Before long insurers would put such massive loadings on premiums for such businesses that the insurance would be unaffordable and they would never get licensed. Either that or the insurers would simply refuse to carry the risk. Either way, my simple criteria would prove to be effective without re-creating the ridiculousness of an FSA styled regime.

Mary Latham

What a smart boy you are Mark. Yes that makes perfect sense and “simple” usually has the best chance of success

Paul Barrett

All these are good ideas.
However where is the commercial imperative going to come from to force LA to adopt effective protection for their clients.
With IFA’s it was the govt.
Clearly as they have indicated the govt is NOT intending to do this with LA.
How then to bash heads together to force LA to come up with relevant protections for their clients.
Somehow all relevant parties involved in the rental industry need to sit down and thrash out a strategy which protects LL and tenants from incompetent LA and from them being able to do a runner with all the deposit and rent monies
So that there will be financial redress in the event of absconding LA etc.
In the meantime I wil not use a LA for management; just tenant source.
Principally because I don’t trust LA.
I cannot be the only LL that feels this way.
LA must surely appreciate that until there are relevant schemes in place to protect LL and tenants then they will be losing out on potential busines.

http://www.property118.com/ Mark Alexander

Maybe the government will do a u-turn when they realise how passionate people are about this and that it affects 15% of all households. If not, perhaps the Councils will find a way to introduce licensing schemes? It would only take one Council to realise that it’s an income generation opportunity and they all be all over it, just as they are now with selective licencing and HMO licence fees. I know that Councillors and MP’s read my blogs which is why I’ve wriiten this. I may not have the power to make the rules but I can influence them. As they used to say at BT, it’s good to talk

Paul Barrett

Yep keep ‘talking’ Mark; you never know it could well have a positive effect.

http://www.property118.com/ Mark Alexander

I plan to write to all of our subscribers asking them to bring this thread to the attention of their local MP’s and Councillors Paul so watch this space

Paul Barrett

YOU could have bad LA quaking in their boots!!
Heres hoping you have successful responses

Roger Lancaster

Hi Paul

I thoroughly agree with you and believe the responsible organisations representing landlords need to come together to determine an educational initiative for landlords. At meetings I regularly come across another individual who is setting themself up as a Letting Agency and often their lack of knowledge and understanding of the industry is staggering.

on your lack of trust.

How would you feel about trusting a Letting Agency that was so confident in its ability to support their landlords that they were prepared to offerthem an entirely unconditional refund of ALL management fees if a landlord decided to withdraw their portfolio in the first 6 months.

You are trusting them with part or all of your portfolio, they are trusting you to properly evaluate their service rather than cynically get your properties managed for free for 6 months.

Mary Latham

Roger Accreditation based on education does what you suggest NLA have a national accreditation scheme, LLAS & MLAS have regional schemes, the whole of Wales has a national scheme and all these are based on the following

1. A one day foundation seminar�
2. A code of conduct
3. Continual professional development
4. An arbitration system for complaints which can result in loss of accrediation in the most serious cases and other sanctions for those that are less serious but where the Landlord has broken CofC

Each scheme will passport a Landlord, at no cost, who is accredited by one of the other schemes

The cost of this type of accreditation is from £80-150 depending on the scheme and accreditation lasts for 5 years. Renewal is free for those Landlords who have gained 50 CPD points over the 5 years, CPD points can be gained at no extra cost or Landlords can choose to attend CPD seminars and pay a small fee.

Mark I have just signed and Tweeted the petition and I hope that this will form the basis of distinguishing the good LA’s from the others and that once the scheme you propose is in place education becomes part of it.

http://www.property118.com/ Mark Alexander

Thanks Mary and rest assured you have my full backing on Landlord Accreditation through regulation. We just need a sponser now to Google search and read all about “The GOOD Landlords Campaign”.

Paul Barrett

Well I appreciate what you are saying.
However before I could trust your circumstances; and I am not for one moment casting any doubt whatsoever on your probity; I would need to be assured that in the event of you running off with my rent and deposit monies and had been incompetent in managing my situation, that I would have insurance redress to recover those monies etc.
I am yet to be convinced that this sort of cover is available to protect LL from LA.
I am in the fortunate position where I do not need a high st LA.
Online agents who just forward tenant enquiries are all I need.
Esentially the online agent is only required as a tenant lead generator.
Were my circumstances different I would have no choice but to use a LA.
I would still be concerned; but I would very much be a hostage to fortune.
I believe that most LL only use LA as they have no alternative.
I believe that refeencing tenants and charging them is an incorrect thing to do.
All they should do is refer the tenant details and I will carry out the reference details.
It only costs me £10.00 to obtain a RGI reference.via a 10 min phone call..
I would NOT take ANY notice of a LA referencing on a prospective tenant, so would a LA bother if it won’t affect whether a LL chooses to take that tenant on.
The majority of LA referencing is useless.
Very few of them use LRS or tenantid; they only check 1 credit reference agency. not all 3.
How hard can it be for Tenants for £6.00 to obtain their statutory reports.
I think it clearly needs to be stated to the tenant that the LA is representing the LL and has been tasked by the contract that he has with the LL to look after the LL’s best interests.
Yes there has also to be a duty of care towards the tenant from the LA but ultimately the LA interest should ALWAYS be in favour of the LL.
If this means the LA doesn’t make as much money as he likes then that’s tough!
It should be the same way of thinking by the LA as an estate agent.
Too many LA seem to think the LL is to be stitched up with spurious charges.
I think your offer or 6 months free letting service, certainly has merit.
Few LL if you have proven your efficacy are likely to go to Fred over the road once you have proven your competence and complete probity.
Pointing out to the LL your circumstances compared to Fred over the road; would I belive convince most LL to stick with you.
I would hope that the majority of LL would recognise that the value of services offered far outweighs the actual cost, even if it is more than the services of Fred over the road.
One of the continual issues I hear from prospective tenants is the amount of fees they have to pay upfront; for what I consider to be totally unecessary work.�
If I like the tenant I will carry out the reference work or I will instruct the La to carry out the work with my suppliers, not who the LA has a cosy relationship with.
Only if the LA could convince that his checking circumstance were better and more cost effective would I consider allowing a LA to to do that work
Is there any letting agent out there who for £99.00 can check and obtain RGI for one year on a tenant or their guarantor/s?.
NO thought not!
And I would use LRS and tenantid…..would most LA
NO thought not!
As you can see the La very rarely may better what a LL may obtain in the marketplace for himself.
Indeed I am attaining tenants with tales of woe about LA charges who now know I am a private LL that does NOT charge silly charges and I am also getting tenant referrals which is saving me a fortune in LA fees and also the tenants.
Indeed my details are on the crew room notice booard at Stansted; put there by Ryanair staff themselves as they are fully aware of how I operate and are more than happy to commend me to their colleagues.
They like the idea of just paying rent and deposit monies.
The cost for me to attain exactly the same internet exposure is £99.00
mydeposits fee £30.0 RGI policy £99.00.
I appreciate I would not achieve tenant footfall leads; but am not concerned as most prospective tenants look online.
I pay these charges leaving nothing for the poor old tenant to pay.
Now perhaps my personal situation could be constued as representative of a lot of LL; but I bet an awful lot of LL full into my category.
I think the poor old LA is up against it and is going to have to pull the proverbial rabbit out of the hat to come up with a more convincing business model to capture LL business.
Your 6 month suggestion is a good start.
More thinking outside of the box is needed; otherwise there will be the continuing drift away to online LA by LL.

Roger Lancaster

Hi Paul

Most defaulting agencies appear to be those who are often paying LL their rent on a single monthly basis therefore it is often 6-8 weeks before a landlord recognises and can react to a problem. Our view is that cleared fund collected the previous week should be paid the following week together with a detailed breakdown of the sum. Some agencies pay over individual sums as they clear but this can be confusing for a portfolio landlord and adds un-necessary costs. This system means a landlord is immediately alerted the moment that sum is not received and can take action to divert funds from tenants back to their account. Minimises loss to around half of one months rental income unless all rents are paid on same day.

Any reputable agent should carry a £25000 bond to cover losses and be a registered member of ARLA and subscribe to their codes.

Finally they should have Professional Indemnity Cover to cover for any negligence on the part of themselves or their staff.

The latter two are items that any licencing system should require for the protection of clients and that Landlords should also carry this cover as they also risk negligence claims from their tenants. It would also be their PI insurer who who deal with PI claims against the LA.

Paul Barrett

I think the problems with LA are not LA per se; it is just that LL and tenants don’t know what criteria to assess the probity of a LA.
The sort of things you are mentioning are ideals.
They are certainly things I am unaware of and I reckon it would go straight over the heads of most tenants.
Somehow LL should apprise themselves as to the things you have mentioned regarding the efficacy and probity of a LA.
How is that to be achieved?
Without your valuable advices being known to every LL and tenant how are we supposed to be able to empower ourselves with the appropriate knowledge to ensure we pick an appropriate LA.
It’s one of those perennials, isn’t it?
Perhaps some sort of check list that could be advised on LA websites or handed over in leaflet form to both LL and prospective tenants.
This would essentially advise that this LA conformed to all the aforementioned and that any other LA who didn’t comply with the checklist should most probably be avoided.
Such information would be in lieu of the ideal licencing system along with insurance that Mark Alexander has suggested

Reg

Mark
I think you have come into the Letting Agent regulation debate at the wrong point.
My feelings are that the whole “industry” and its processes needs reform.
Within the business model of the average Letting agent there is a fundamental conflict of interest.
Who do they actually represent during the letting process?
The landlord, from whom they take a fee.
Or the tenant from whom they also take a fee.
How can they find a quality tenant and check references objectively for the landlord (who pays for each of these services) while they also are anxious to collect the fee from the tenant for producing the agreement and creating the tenancy?
The law industry does not allow its practitioners to prosecute and defend simultaneously in the same case, so why are Letting Agents getting away with it?
Reg

http://www.property118.com/ Mark Alexander

The way I see this Reg is that the Letting Agent acts for and is accountable to the landlord as his agent. Any rules broken by the agent on behalf of the landlord or as a result of the agents negligence or incompetence remain the responsibility of the landlord, that is already a given. For example, if an agent fails to protect a tenants deposit or lets a property without a Gas certificate it is the landlord who is responsible for the consequences. If the tenant suffers any damages (financial or otherwise) as a result of an agents negligence the tenant or his representatives will litigate against the landlord. Therefore, it is vital for the protection of the landlord that the agents is bonded and has PI insurance. Similarly, if the agent lets a property to protect his ongoing management fees, without proper tenant referencing or a disclaimer from a landlord accepting that a tenant is not recommended, then again the agent is at fault in his duty of care to his client (the landlord). All of the above will obviously be tested in Court over time and case law will evolve based on PI insurers fighting claims. It really doesn’t have to be complicated regulation. The simple licencing system I have proposed leaves the commercial decisions to be made via the courts and the insurance companies as opposed to civil servants who often don’t understand the complexities of the businesses they attempt to regulate.

Ian Ringrose

Whenever I have used IT employment agents to find work, it has been very clear that they are acting for the client and hence I have never expected them to do anything for me as the candidate.   For example, I have never got a job offer on the paper headed with the employment agent’s name and logo only showing the employers name hidden in small print.

However in my experience as a tenant, all the letting agents branded the tenancy agreement with their logo and company name making it look like they are the provider of the property.    Likewise in adverts on RightMove and elsewhere the agents don’t make it clear they are acting only for the landlord. (Property selling agents see to avoid a lot of these problems, as they get paid by the vendor not the buyer.   While renting agents are seen to be paid by the tenant with them then passing on what is left after the charges to the landlord.)

Hence it is very easy for tenants to believe they are the customer of the agent and that the agent should do what is best for the tenant.   Maintenance admin staff working for agents that spend all day answering phone calls from tenants with this mind-set can very easily be forgiven for developing the same mind-set themselves. Saying no to a tenant is often harder than passing another bill onto the landlord.

I think tenants are more likely to talk to each other about the quality of property and repair service they have got var a local letting agents, then none local landlords are to talk each other. So an agent must keep the tenants happy if they are to stay trading, regardless of the fact that they are required to “work for the landlord throughout”.

Due to having properties at a distance I only know one other landlord with a property close to one of ours. (I have never seen the point in asking an agent for reference from landlords, as all agents have some happy small landlords and the service given to large landlords is unlikely to match the service given to a landlord with a single property.)

I am very glad that I am not the “pig in the middle” in this mess of conflicting expectations!

http://www.property118.com/ Mark Alexander

Why thanks a lot Ian !!!

“I am very glad that I am not the “pig in the middle” in this mess of conflicting expectations!”

Oink, oink LOL
Mary Latham

If a Tenant pays an Agent that Tenant is a customer. When both the Landlord and the Tenant pay the Agent there is, in my opinion, a conflict of interest.

I know Agents who charge both the Landlord and the Tenant for the same services, Tenancy Agreement, Referencing and Inventory to name the three most common. Who is the Agent working for?

http://www.property118.com/ Mark Alexander

There is a big different between paying for a service as a customer and employing a person to act as your agent. so long as the position is made clear I can’t see why a Property Manager can’t act as agent for a landlord and charge fees to customers which are tenants. I’m no expert on agency law but I do know enough about it to know this doesn’t have to be a problem. The real problem is perceptions.

Mary Latham

If I use an Agent as a Landlord I do not “employ” him I pay for his services. If I use an Agent as a Tenant I also pay for his service. I cannot see any legal difference?

An Agent is, by definition, a “go between” and therefore he will have two clients. That Agent may charge each of those clients for the services that he performs ON THEIR BEHALF but not for services which are also being charged to the other client in the transaction.

An Estate Agent performs a similar service but charges the client who is selling not the client who is buying. A Solicitor would not be allowed to work for both the buyer and seller (it might cut costs if they could) because of conflict of interest.

I know several Landlords who charge an admin fee of around £150 and if the Tenant is prepared to pay that fee its fair enough. I heard of an Agent recently who charged £440 admin fee for a one bed flat shared by a couple on a joint AST. The cheeky monkey charged the same fee again to renew the AST for a second term and everything was done electronically and not very well. I wonder if the Landlord was also charged the renewal fee?

If I used an Agent I would be happy to pay for his services but not for him to charge my Tenants for the same services again. I would want to be clear that he has no confict of interest because he is being paid only by me.

http://www.property118.com/ Mark Alexander

The difference Mary is that you would have a contract with your Letting Agent and that contract means that you are employing his services, outside of the generally accepted conditions of employment law but well within the conditions of agency law. A tenant has no such contract as he’s simply a purchaser of services. The morality of double charging is not what I’m questioning. That’s another debate for another day. First things first, let’s get Letting Agents who handle client money licenced, support the good ones and drive the real crooks out of the business.

Roger Lancaster

Mary/Mark

The problem you have both identified lies in the contract between the parties involved and paying for a ‘service’ involves a cointractual relationship whoever the individuals are and their relationship to each other.

The problem is that many LA’s contracts are very poorly written and do not explicitly deal with the detail that is required of either party and in particular what are the responsibilities of the Landlord within the contract the LA is setting up between the Landlord and the tenant.

Neither does it explain any indemnity that the LA is providing in case of default or negligence. As a result these situations are opaque and the landlord has no clear idea. As part of Marks Licencing it should be a given that a standard minimum contract which coves many of the issues raised above, must be part of the process if it is to have any validity at all. I would hope ARLA would have such a document for its members to use as part of their code.

In the interim we need to raise LL awareness of what they should look for in the contract.

Mary Latham

I agree Roger but if we front load Licensing requirments it will increase the red tape and cost of administering the system. I think the best option is issue the licence on application. The insurer would soon begin to realise that there are certain basic measures that would reduce their risk and would either load premiums or impose conditions

Raising Landlord awareness is a major part of my working life – most of the rest of the time I am digging out Landlords who have fallen into one of the many potholes in the road to financial freedom.

http://twitter.com/sally_lawson Sally Lawson

Reg
As a letting agent we absolutely work for the landlord throughout and this has to be quite clear at all times. although legally we have what is termed as a “duty of care” to the tenant.

I have heard many stories however of agents getting this horribly wrong however and taking the tenants side, particularly in deposit returns and maintenance, this is a common issue which causes a lot of distress for the landlords, and is down to ignorance and lack of training

This comes down to an agent having good clear terms and conditions, and also solid training and monitoring of its staff.

i heard of one agents staff member, that when the tenants shouted at her she would just return the deposit to them (but then send ot to the landlord too!). This is theft, but highlights that this and other companies do not have the self regulation that the good agents have with the likes of ARLA etc.

we have to audit our client accounts monthly to ensure that what money is in there is in there, (this obviously was not being done) we cannot pay out money we have not received due to bye law 3.

Good agents have a double entry payment system with authority levels, sometimes leading to a triple entry system, this means that payments cannot be made without 2 or 3 people authorising it, and this should be backed up by a seperate accountants auditing.

i agree with that the initial file sort set up is key as landlord referencing state, this is the point at which most mistakes are made, i have worked as a consultant with many letting agents and this is their weakest point. i have seen files with no gas certificate, no signed agreements, incorrectly served notices, no references etc. and someone has paid for this. so a star rating here would be an awesome idea!

on my presentations i tell all my attendees to “check your files” go into your agent and ask to see your files! its a great test! following on from that someone asked me to record a video as to what should be in a file and my property manager Helen did so, it is on youtube lettingscoach channel, so you can compare.

regulation would be a good thing to level the playing field, in the meantime landlords need to help themselves and be more diligent, not just looking at fees, but looking for evidence of testimonials, quality service, and back end systems to protect them along with professional indemnity insurance, cliet money bonding and protection, regular auditing and qualified staff!

Roger Lancaster

Hi Sally

How would you feel about a landlord being able to access all his properties accounts and records 24hrs a day, 365 days per year from anywhere in the world with internet access. Surely this would be the ultimate security for a Landlord. I can do it for my bank account why not my portfolio.

Mary Latham

Reg makes a very good point. Lettings Agents serve two masters, they do work for the Landlord in terms of managing and letting the property and the Landlord pays for these services. Most Agents also take fees from Tenants to set up (and renew) the Tenancy They have a conflict of interest. Most Agents consider themselves to work for the Landlord but I wonder how that would be viewed if it were legally challenged?

I would like to see clarity on exactly what an Agent should charge to a Tenant and what should be included in the Landlords letting fee.

I would also like to see someone attempt to write guidance for Agents on how to ensure that they are meeting their implied obligations to each party.

Reg has actually put into words a situation that I have witnessed many times where the Agent is stuck in the middle of a Tenant and a Landlord. Agents may well have signed contracts with Landlords but they surely have legal obligations to Tenants who have paid for their services too?

Sorry if this is off the main point of the thread Mark but I think that this is at the core of many problems and I am interested in what other people think, Landlords, Agents and Tenants

http://www.property118.com/ Mark Alexander

Hi Mary, do you not think that the responses from myself and Sally Lawson addressed these issues adequately? If you don’t, please feel free to ask more specific questions so that the Property118 community can share their thoughts.

Ian Ringrose

We have had to remind one of Sally’s staff in the past that we are the customer not the tenant and that the tenant is not always right, (e.g. the tenant does not automatically get a new carpet just because a carpet sales person has told them they need one, when we believed just the door bar needs to be fixed) – So I think this is a big issue. I have never see an agent make clear to the tenant(s) that the landlord is the customer not the tenant – when we were renting it was always presented as if we were renting from the agent. All the paper work had the agent names in big print and the landlords name as a bit of “unimportant” small print.

http://twitter.com/sally_lawson Sally Lawson

With regards to tenants and maintenance, when items are reported to us as needing rectification or repair, in this case carpets thinning and rippling, we have a duty to refer this to the landlord, and carry out their instructions.
�
I can see here that you asked us to get quotes for both replacement and stretching, which was done. Our overexhuberant contractor for some reason chose to take samples with him to the property, but this was not under our instruction and we have certainly stopped him from doing that again.
�
We would certainly never intentionally give a tenant the impression that they have the right to new carpets, unless this was part of a rent review or negotiation which had been agreed with the landlord.
�
If you would like to discuss this with me i would happy to do so.
Mary Latham

Ian, It makes me very uncomfortable to read posts on public threads that could perhaps have been private messages.

I stopped posting on one forum because of this type of comment. It would be a pity if people felt vulnerable posting on fora like this one and I am certain that this is not your intention.

http://www.property118.com/ Mark Alexander

Here, here Mary. I’m glad somebody else feels this way. For your own piece of mind, rest assured that every single post on this thread is moderated by a human being, often me personally. I would not have allowed this to escalate and I am very pleased that Sally responded as she did with an offer to discuss this matter in person with Ian.

Mary Latham

Yes Mark I do know that and this is why I came back to post on the thread. Having been a target of this style of post yourself I know that you will not allow P118 to become a “pillary”

Roger Lancaster

Hi Mary

Can I completely concur with what you and Reg are saying about the dichotomy that exists between the Landlords interests and those of the Letting Agent.

Perhaps instead of a guide for Letting Agents we should actually be promoting a guide for Landlords which educates them into what they can expect a Letting Agent to provide and how to check whether they actually do so. It was with this aim to get this education process going that I wrote my series of Articles in Property 118 that Mark was kind enough to publish that sets out what the level of service a Landlord should be expecting a 21st Century Letting Agent to provide.

Perhaps if Property118, NLA, RLA, ARLA and Local Authorities really started campaigning on this front in their publications, websites and at their meetings and conferences perhaps we might achieve much of our expectations and we may even be get the PI companies on board as well.

I like Marks idea of the simplified regulation and will certainly throw my weight behind it but doubt that it can be a quick answer benefiting landlords now if ever. Ultimately if given the tools to evaluate a letting agent a landlord still goes to Fred in The Shed, the ultimate cut price LA then perhaps he or she desreves what they get. The Red Tape Nanny State does not always benefit those it intended to protect. Lets try education first and light regulation if it is ultimately required.

http://www.property118.com/ Mark Alexander

To all in favour of my suggestions, please check out and sign my Government e-petition http://epetitions.direct.gov.uk/petitions/28848

Roger, I agree that Landlord education needs to improve and I also beleive that good landlords deserve more recognition – please Google search “The GOOD Landlords Campaign” on Property118

Roger Lancaster

Hi Reg
Unfortunately the world is full of these examples, eg Recruitment Agencies, Estate Agencies to name but two, both of which are regulated and to my own personal knowledge still full of Fred in The Shed type jokers.

It is only when the Agency Profits are directly aligned with maximising the income to the Landlord will this be resolved. At this point the LA becomes an Asset Manager for the Landlord rather than seeing the Landlord as a profit centre.

Anonymous

We’ve set up an epetition to make more people aware if this, do sign the petition for compulsory licensing of Lettings Agents to protect Landlords and Tenants and pass it on! [http://epetitions.direct.gov.uk/petitions/28848]
Mary Latham

Roger I would be more than happy to meet you to talk
about this mary.latham@landlords.org.uk

Something that I have learned over the many years that I
have worked with Government and local authorities is that evolution is more successful
than revolution and this is the reason that I am supporting Marks campaign. When Mark first suggested his idea I thought “that
not going to the nub of the problem” but having considered what Mark said on
this thread I can see that his little acorn would grow naturally because
Insurers are very good at reducing their exposure and once they realise that education
is the key to doing so they would be on side and a powerful ally.

The Landlords that I meet fall neatly into two categories

1.     Those
who know that they are Landlords

2.     Those
who think that they are passive property investors

The first category is split in half again

1.     �
Those who want to remain in control of their
property management

2.     �
Those who do not want day to day involvement but
want to retain control

Those who think that they are passive property investors are
the ones who worry me most because these are often people who hold down high
level jobs and have high disposable income.�
They are investing for the future and their only or main concern is the
return. When these people venture into residential property they do so on the basis that they will use an Agent to do
everything. Many of these people have
never seen their investment properties and this is why some high profile
companies were able to “scam” people out of £m’s before going OOB in recent
years. These are the most vulnerable Landlords because they do not even realise
that they are Landlords let alone the legal responsibilities that entails.

The second vulnerable group are those who do not want the day to day involvement and
think that by using an Agent they can just make decisions about how much is
spent on repairs/replacements and the levels of rent and leave all the problems
to the Agent.

Those Landlords who want to remain in control are the ones
who usually attend my seminars because they are aware that they need to
understand legislation, regulation, documentation and communication in order to
reduce their work load and risk. Of course there are some Landlords in this
category who tell me “I have been a Landlord for 20 years I know what I am
doing” – they rarely know that legislation and regulation has moved on and that
we are now living in a litigious society where Tenants can access information
on Internet and use it against a Landlord.

My question is

How do Landlords know what to expect from Agents if they don’t
know what is expected from them and which parts of the job they can devolve and
which they cannot?

http://www.property118.com/ Mark Alexander

WOW, what a fantastic post! This could have been a blog in its own right. What an amazing thread this is turning out to be

Paul Barrett

Mary on top form again!!
You gonner have to start paying her soon MARK…. LOL!!

http://www.property118.com/ Mark Alexander

Paul, if I know Mary, and I think I know her pretty well, she wouldn’t take money even if I offered it. We are kindred spirits and we do what we do here for the love of our industy. Neither of us would compromise our integrity or independence for financial gain.

Paul Barrett

Here, here!
And just as a matter of interest are there any let’s say small and perhaps less knowlegeable LL out there that for whatever reason choose not to comment.
You have well informed individuals who post regularly; I am not including myself as knowledgable!.
It would be good if those with less lnowledge could post and perhaps learn a lot from responses from the more informed posters.
So they would not be considered as ignorant; but just genuinely eliciting information in perhaps obvious anwers to their genuine enquiries.
I have learnt an awful lot by making relevant responses.
It would be interesting to hear about other small LL and their experiences; problems and issues.
This as I am sure we can al learn from individual experiences.
You have massive newsletter circulation.
It would be interesting to hear from those landlords who may consider themselves amateurs and perhaps may feel intimidated by the expertise that presents itself on the site.
Perhaps there could be a sectrion for newbies of for those less sure of thenmselves where they could post without any concerns being shown for lessor knowledge than the usual poster.

Mary Latham

Paul there are a lot more people reading these threads than are posting. Landlords often ask me about things that I have said on a thread and comments that I have made on this site have been mentioned on another site in a post.

You have a good point about Landlords feeling that the should know something and feeling reluctant to ask for fear of looking ignorant. In my opinion the foolish person is the one who would rather get it wrong than ask. I ring the NLA advice line often to check my facts. So many things have changed in this business over the last few years and I can honestly say that I learn something new regularly and this is often something that I should have known. There are very few people who could honestly say that they know everything about the business.

If there are Landlords reading this who do not feel comfortable asking questions just use a site name to protect your privacy. I guarantee if you don’t know something you will not be the only one.

Mary Latham

Thank you Paul I really value a pat on the back from a peer.

I post here because I learn and share and I am abe to say what is on my mind about the business I love without worrying if this or that organisation would agree with me. The freedom to express my own views is worth more than money at this point in my life. (Thank you Tenants)

Ian Ringrose

You left off, “landlords” that would rather not be landlords but are
forced to rent out a property they can’t sell. It is very likely that most of these landlords only know what the few agents they had round to do a rental valuation have told them. The sad fact is the often the agent that
claims the landlord will have the least responsibilities is the one that gets the contract.

How can this group be reached and provided with information?

http://www.property118.com/ Mark Alexander

Every property that’s been let over the last few years should have a Gas Certificate, an EPC and a Deposit Registration. If the Government was mindful to encourage best practice they could access all of these databases and offer advice, just as they do for other organisations such as HMRC.
http://property118.com/ Teena Vallerine

Good point Ian. We call them ‘Reluctant’ or ‘Accidental Landlords’. Some go on to enjoy property, sadly many more get badly stung as they have little understanding of their obligations and are often caught out by a ‘gentleman’s handshake’ approach. Sites like Property118 are a great way to offer them information.

http://www.property118.com/ Mark Alexander

That’s how I got into this business. Couldn’t afford the mortgage payment and was in negative equity so I couldn’t sell it. Couldn’t afford to get reposessed as that would have prevented me from continuing in my career at the time which was Financial services. I let my property and rented something smaller. It only made a difference of £150 to my monthly outgoings but that’s all it took for me to get through the crisis of the early 90′s. I still own that property and it’s trebled in value When things picked up and I’d saved up (6 years later) I purchased some more. They when they increased in value I remortgaged and purchased some more. Then I made more money and I purchased some more. Then I got divorced but that’s another story

When the going got tough I started blogging and that’s how Property118 was born.

Ian Ringrose

We have to be very careful in how we define a “letting agent” when calling for regulation, for example one of our friends that lives close to our flat has offered to do inspections for us and manage the maintenance when he is unable to do the job himself.

If we were to take him up on the offer but not have him do any of the
rent collection, it would be most unreasonable if he had to be a member of a regulation body. Likewise for landlords that directly manage their own roperties and offers to help out a friend for a small charge.

So how should a “letting agent” be defined, such that all agents that should
be regulated come under the regulation but we don’t get lots of red tape that
revent people helping each other out?

http://www.property118.com/ Mark Alexander

Hi Ian, I used the word regulation in the title of this article to capture attention. My proposals, however, are for compulsory licencing of agents as opposed to full blown regulation. It would only affect agent who handle client monies as an intermediary between landlord and tenant.
Mary Latham

Ian I did not exclude accidental Landlords they fall into the same categories as those who make the decision to become Landlords.

In your second post you illustrate what I call the “yes but” mentality sometimes known as the “cake and the ha’penny”. It is not about the legal relationship Landlords have with others who help to manage their properties it is about which parts of our jobs we are out-sourcing. Even when I am overseeing for my sister, who lives abroad, I am her Agent and would therefore need to be regulated.

Marks suggestion does not involve red tape, its simple and that is why it has a good chance of success.

Paul Barrett

Yes I can see you have a foot in both camps, so to speak and what you do is a very good way of being transparent with the managing of the tenancies on behalf of LL.
Not many LA offer such an efficacious service as you presently are.
I think transparency which you are facilitating is something to be commended for and should be part of your overall USP’s.
These may well attract additional business compared to other LA offerings.
http://www.property118.com/ Mark Alexander

I completely agree Richard and that’s exactly why this licencing should be compulsory. We can only guess at how many agents are dipping into client money but I’ve heard several stories of good businesses who have looked to buy other letting agents only to discover this goes on more than many could possibly imagine. I think that’s why the likes of ARLA push so hard for regulation and why so many agents fight against it. If only the good agents were to sign the petition and get their tenants to do the same we would easily get 100,000 signatures and get this raised in parliment. It’s been a slow start to getting signatures on the petition but we have a whole year and hopefully the message will spread. If only the agents who have commented here were to ask their tenants to sign the petition that would be a few 1,000 and with a bit of luck that would be sufficient to start an avalanche of signings as they pass on the message.
Paul Barrett

My long held and unproven suspicion that I have long held with no direct experience is that as you suggest most LA are NOT running a viable business proposition.
Essentially only deposits are being used as free cashflow to keep these unviable businesses going.
Personally I don’t think LA should be allowed to go anywhere near tenant deposit or rent monies..
The monies should only be allowed to be accessed on production of relevant paperwork.
An independent deposit provider needs to be enforced.
Personally I do not see why ALL deposits should NOT be controlled by LL.
It is ultimately their liability anyway.
So no matter what scheme is used the monies should ALWAYS be in a LL account.
As suggested if such strictures came in then lot of LA would go out of business.
These circumsatnaces confirm all my suspicions about LA which I why I will NEVER allow them to receive rent or deposit monies.
The tenant will be required to pay directly into MY account.

Steve

I agree LA took my deposit yet i had to pay it back to T. Stole rents from me. Stole one tenants stupidly put through agents door. I got 10p in the pound back after the office furniture took priority. Had to borrow from parents to get over this yet agent was up and running again. Letters of York. Never used an agent again. Stay away from them.

mary Latham

A recent NLA survey of members has found that 81% consider letting property to be their pension fund. My concern is that many landlords do not realise that letting property is not like other investments and cannot be a passive investment. Landlords often buy property and put it in the hands of LA’s so that they do not have day to day involvement and this is why it is so vital that those LA’s get it right.
�
NLA report here
�
http://c.moreover.com/click/here.pl?z5890202129&z=1550248679
http://www.property118.com/ Mark Alexander

Please see our latest Press Release on this subject. Comments taken from this thread.

http://www.property118.com/index.php/compulsory-licencing-of-uk-letting-agents/24228/
http://www.angelspropertyservices.com/ Angels Property Services

I have PII cover and I have a recognised bank account designated as a “client money account” (two of them in fact – one for day to day client money and the other for long term deposits held) but I can’t find anywhere I can buy insurance similar to the ARLA client money insurance offered to their members.

I’m not eligible to become an ARLA member (or wasn’t the last time I looked into it) and not only that I suspect they make money by charging members for the client money bond as the charge to their members must way more exceed ARLA’s actual cost of the bond. I’d rather get my own insurance and remain independent.

Any ideas how I get this client money bond insurance as an independent?

http://www.property118.com/ Mark Alexander

I am not aware of an insurer who offers bonding to independent at the moment but I have to admit to not spending too much time looking around. The simplest way for you to operate would be to set up TDS or MyDeposits accounts for each of your landlords and to allow them to hold the deposits. When Licensing does come into force though I’m sure it will not be long before the insurance companies recognise the opportunity.

As a matter of interest, why would you choose to hold client monies when you can’t offer protection? Why wold your landlords and tenants be comfortable with that when they could insure the money and self insure?

http://www.property118.com/ Mark Alexander

It was never going to be easy to get 100,000 signatures and there’s no way I can do it on my own. However, if everybody who has signed asks everybody they know to sign and tell everybody they know and so on it is achievable.
http://www.property118.com/ Mark Alexander

I sympathise with your dilemma but if you are expecting your friends to trust you with their money is it not fair for you to be able to demonstrate that it is secure regardless of your circumstances? If you simply help them to let property and offer maintenance for a fee that’s different as they can protect their own deposits and collect their own rents.
Paul Barrett

Got to advise you there is no way I would let you have my £5750.00 in deposit monies unless you had a liability insurance bond.
I couldn’t care the less about your business costs, you either have the bond or you don’t get the business.
This would be one of the costs of being a good LA who acts with full probity.
Without the correct insurances YOU are not a good LA and I wouldn’t use you.

http://www.property118.com/ Mark Alexander

It’s not just landlords that feel this way Paul, tenants like to know who they are handing their money over to too.

Paul Barrett

Yes hadn’t really thought about it from that angle.
I think the problem is LL and tenants don’t know how to differentiate between good and bad LA.
There is nothing particularly obvious to assure as to a LA probity which I think your insurance suggestion is the only way to go.

Chris Brown

I am concerned that you are mixing up Letting Agents and the ‘Lettings Industry’ I am a small private landlord specialising in 1 bed flats in the South West. I do not use any Letting Agents: they are too slow to fill a void and feees are excessive for young first time tenants. Before recent deposit protection legislataion we were able to agree deductions [if any - rarely] with the majority of tenants and re-imburse them on the day of departure so that they were not financially embarrased moving to a new tenancy. Not so now. I do not want some all-embracing carapce legislation to be brought forward which further ensnares me and my tenants. We were very happy as we were.

http://www.property118.com/ Mark Alexander

Hi Chris, no mix up here. I’ve been a landlord since 1989 and I too have seen a change in the last 5 years. Deposit protection is simply a sympton of that change, the internet is the cause. People are better informed of their rights and it is easy for them to share their woes with the world.

I realise that I need to protect my deposits becuase there were too many shysters who saw them as their money. Like you I always played fair. I now have to pay £30 every time I create a new tenancy for deposit protection. I never used to charge letting fees but I now charge £150 to cover all the referencing and extra admin etc.. I’m better protected these days and so are my tenants but they are paying for that, not me.
Paul Barrett

I am afraid that the Lettings industry and LA are inextricably entwined.
Your way of doing things is now passed it’s sell by date.
It is a shame that this is now the case; but as Mark says the internet now gives information to all and sundry.
The days of a gentleman’s handshake are long gone.
The county court system conspires against LL and savvy tenants can destroy a LL’s business if they are not on their game.
It is a terrible indictment of the way things have ‘progressed’.
Now you have to make sure you have your a–e covered.
LA whether you like the idea of them or not are for some LL a vital adjunct to their business.
Personally I use DIY methods such as online LA to keep my costs low.
So I am with you here; we can manage our circumstances and make it a cheaper proposition for tenants rather than them going to a traditional LA.
Because of the amounts of monies involved ; whether we like it or not I think a sensible LA regulation system is needed.
I think Mark’s ideas are probably a cost effective solution to these seemingly intractable LA issues.
In fact with the advent of the internet the costs for a private LL to let out a property have reduced massively.
Eg.
Tenant source via online LA
£50-£99
Credit check for an RGI policy
£10
RGI policy £89.00, no excess.
£30.00 mydeposits fee.
Comparison with a normal LA
50% of months rent if tenant source only!!
Plus charges for AST etc
95% of tenants look online now for rental property.
LL will continue to migrate to these methodologies so much so that LA are going to have to put a convincing case to LL to acquire their business.
The internet has been a great leveller and stopped restrictive practises in their tracks across all sorts of industries.
Therefore I don’t think that this LA proposal will ensnare you or your tenants.
It certainly won’t affect me and it shouldn’t you.
If you choose later to use a LA then a LA additional costings may be passed onto you in the form of higher fees.
If however ALL LA are regulated via Personal Liability insurance then you would be able to choose from LA who ALL have to subscribe to it and have set their prices accordingly.
It will then be a level playing field.
Unscrupulous LA will hopefully be eradicated.

Mike

As a LA I fully agree with further legislation however I dint want it run by the local council as I am in the Manchester area and all the local council wants to do is charge silly fees for nothing. They made a mess of the selective licensing.
If all agents had to be a member of ARLA, they have to be in a deposit scheme, they have to have client accounts, PI insurance, training with the NFOPP and be members of the TPO. We also carry client protection money insurance. ARLA advertising so more LL and tenants are aware and maybe joining up with “safe agent” would be a way forward. Displaying there PL insurance or having to produce it to LL as requested to show that they have renewed it would also ensure that LLs can be reassured.
I do feel that a lot of LLs are to blame for the need of more regulation (which I welcome) because of there failure in carrying out correct DD before appointing someone who isn’t ARLA registered

http://www.property118.com/ Mark Alexander

I agree that ARLA has a very robust framework and that all ARLA members should find it very easy to be licensed. However, if licensing was to insist on ARLA membership on day one other good letting agents might find the barriers to entry to difficult. Any initial licencing would need to be simple, I feel very confident that over time the insurers would encourage all agents to aspire to ARLA membership, if only to keep their insurance premiums affordable.
mary Latham

I agree that we don’t want local authorities to control a scheme like this but neither do we want barriers that prevent small well run agencies continuing to grow and I am sure that Government would not go down that route anyway. A simple licence is what Mark has suggested and this should be run through a national administrative centre like road tax. It will be the insurers that will increase the regulation as they seek to reduce their risk and identyfy safe practice.

There is nothing to prevent ARLA or any other organisation bringing in more self regulation for those LA’s who choose to joiin and can afford to do so.

http://www.property118.com/ Mark Alexander

That’s a very good point Mary, I hadn’t thought of it like that. A company called Capita run most licencing schemes like this, your TV licence being a good example. I have a few contacts there so I will get in touch.
Ian Ringrose

I agree with Mary that road tax is the correct model with the insurance
and MOT being checked before you get the road tax. It has low admin cost and works very well. I don’t like the ideal that a national agent
will need a different licence for each area they have a property in.

mary Latham

Good point Ian that will be like HMO licensing where not only do standards vary across local authority areas but costs vary from £250 to over £2000 for the same licence in a similar property and that is just simple wrong.

I hadn’t thought about the MOT and road tax aspect I expect this would be like the licensing authority being able to access data on HMO licences (this should be straight forward) EPC’s (on national record now) Gas and Electric Safety (these are held by the awarding bodies). A landlord should not need to do anything all this information should be easy to collate and can be checked when the landlord applies for a licence

Perry

hello

I recall that there is in the various pieces of legislation (Estate Agents Act) which enables the Secretary of State to issue legislation to make only suitable qualified and/or certified people – able to call themselves ‘Estate Agents’.

It happens in America and makes for a certain level of competence. i know trhe RICS has tried to ensure thoise who call themselves EA and are RICS memebers do carry out thier duties to a certain standard.

However, despite the need, the Sec of State has not implemented the legislation to make sure that certain minimum standards are met. it doesn’t need any more legislation – just to action that which is there at present.

For a view from the office of fair Trading see the notes from one of their training sessions on :-

http://www.tradingstandards.gov.uk/kent/presentations/OFT%20EA%20training%20seminar%20pres.pdf

See page 18 which talks of an ability to negatively lisence but not to positively lisence to stop the problems before they occur – on the grounds of having a market open to entry by all if so inclined.

Mmmm – why not make door / security staff lisenced in such a way and only censure them as and when a ‘bad apple’ occurs and members of the public are harmed.

Any case - I am not an Estate Agent and do not have a direct interest in making a minimum standard for Estate Agents upon whom many people place a significant reliance.

I am a Fellow of the |RICS and i am fed up with being associated by people who do not understand the industry calling me an ‘Estate Agent’ due to the number of ‘bad apples’ in that unlisenced and poorly checked area.

http://www.property118.com/ Mark Alexander

Perry, as you correctly point out, it is compulsory for Estate Agents to be regulated under the Estate Agency Act and to subscribe to an Ombudsman scheme. However, that act does not apply to letting agents and client money protection is not regulated for letting agents, it is, however, for landlords. This means that when a letting agent fails in his duty of care to protect a tenants deposit it is the landlord who is held liable.