Plans to reform and regulate the work of letting agents could finally mean they serve their crucial purpose in the sector, according to Chartered Institute of Housing policy and practice officer David Pipe.
The letting agency industry is a sector “which badly needs professionalising.” At present in England there is no requirement to have any kind of specialist knowledge to practice and there is no nationally recognised code of practice that agents are expected to adhere to.
Agents can now be banned from practicing if they have been convicted of certain offences, but this is likely to only deal with the very worst offenders. There remains a great deal of evidence to suggest that standards across the industry are highly variable and that examples of poor, but not necessarily criminal, practice are common.
More must be done and the good news is that Government recognises this and is beginning to take further action. “In future agents will be required to obtain a nationally recognised qualification to practice, with at least one person in every organisation required to have a higher level of qualification. In addition a new, independent regulator will be established with powers to take action against agents who don’t adhere to a code of practice”, says Mr Pipe.
Scrutiny
“These changes are really welcome, although the exact timescale for their introduction remains unclear. Agents should fulfil a vital function in a sector that is characterised by small scale, often accidental, landlords.”
Mandatory qualifications, codes of practice and a regulator with powers to take meaningful action against rogue agents are all measures which should help to ensure this. At the same time the Government is taking action to ban letting agents from charging fees to tenants, although the exact details of the ban are still being worked out.
A draft Tenant Fees Bill was published in November. It proposes a complete ban on fees for things like drawing up tenancy agreements and to cover the cost of reference checks, as well as limits on the size of both security and holding deposits that agents will still be allowed to ask for.
As part of its passage through Parliament, the draft bill was scrutinised by a cross-party group of MPs. Their recommendations included reducing the proposed limit on security deposits from six weeks’ rent to five, and they questioned whether default fees (fees charged for things like lost keys), which will still be permitted, could be used by unscrupulous agents as a loophole.
In giving evidence to the committee CIH head of policy, Melanie Rees, argued for a four-week limit on security deposits as well as raising concerns about default fees.