OFT launches new customer code for letting agents

by Property118.com News Team

9:12 AM, 2nd August 2011
About 7 years ago

OFT launches new customer code for letting agents

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OFT launches new customer code for letting agents

"OFT to allow ombudsman to bring in code for letting agent"

The Property Ombudsman finally has government go-ahead to tighten up on rogue letting agents who exploit landlords and tenants.

After two years of trying, the Office of Fair Trading has given the nod to the ombudsman to introduce a lettings code for agents.

The aim is to give better financial and legal protection to some of the worst excesses of poor letting agents.

The code is the first stage in a process to allow letting agents to display an ‘OFT approved’ logo on web sites, shop windows and documents.

To join the scheme, letting agents must demonstrate:

  • Tenant deposits are kept in separate from business money in a designated client account
  • Letting agents cannot include commission for property sales or lease renewals carried out by someone else in their agreements with landlords
  • Where a tenant pulls out of a let through no fault of their own, any holding deposit will be refunded in full within 10 working days.
  • The ombudsman will offer a free mediation service for tenants and landlords complaining against a letting agent who belongs to the service

The property ombudsman is now setting a monitoring scheme to test the code that involves mystery shoppers and customer surveys.

Cavendish Elithorn, Senior Director of the OFT’s Goods and Consumer Group, said: “This code, together with the property ombudsman’s redress mechanism should establish good practice in the letting industry.

“The code reiterates the need for letting agents’ terms to be transparent and fair. This specifically includes ensuring private landlords are not locked into long contracts under which they have to keep on paying renewal commissions when they wish to change agent, or which require them to pay sales commission unfairly.

“The ombudsman has undertaken a great deal of work to develop this code of practice and we will continue to work closely with it towards full OFT Code Approval.”



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