The House of Lords Industry and Regulators Committee has urged the Government to get on with establishing a regulator of property agents, four years after it committed to doing so.
In a letter to Michael Gove MP, Secretary of State for Levelling Up, Housing and Communities, published today (Friday 22 March), the Committee warns that the Government’s delay is impacting tenants, leaseholders and others, who continue to be exposed to malpractice.
After hearing evidence from campaigners for leaseholders and tenants, professional bodies representing property agents, The Property Ombudsman, the Leasehold Advisory Service and National Trading Standards, the committee has 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 practice.
LIMITED IN SCOPE
It also says current forms of enforcement and redress are reactive and limited in scope and that the Leasehold and Freehold Reform Bill does not sufficiently address the issues that leaseholders face, and needs to be supported by greater regulation.
As a result, the committee is calling for legislation to establish a new regulator, or, at the very least, a full published response from the Government to the report of the Working Group that recommended establishing one.
It also wants mandatory qualifications for property agents including dealing ethically with consumers and industry codes of practice operated by the new regulator, focused on achieving good outcomes for consumers.
It also wants a Memorandum of Understanding to be agreed between the new regulator,
National Trading Standards and the redress schemes to ensure cooperation and avoid duplication.
It also says that the Government should legislate for statutory consumer representation in the sector to ensure their views are loud and clear and to approve a single ombudsman for property agents, rather than two current competing schemes.
And it wants the new regulator, after initial Government support, to fund its activities through fees, charges or a levy on those it regulates.
UNANIMOUS EVIDENCE
Baroness Taylor of BoltonBaroness Taylor, Chair of the Industry and Regulators Committee, says: “During our inquiry, there was near unanimous evidence from consumers, industry and existing bodies on the need for statutory regulation of property agents and the establishment of a new regulator.
“The Government has been sitting on its hands for four years, by not acting on the report of the Working Group it set up. In the meantime, the impact on poor regulation is being felt by tenants and leaseholders, and the sector has been left in limbo.
“I have also expressed to the Secretary of State that we would have appreciated a minister from his department providing oral evidence to the inquiry.”
Timothy Douglas, Head of Policy and Campaigns, says: “Propertymark welcomes the Committee’s findings and its recommendations for greater regulation of property agents.
Timothy Douglas, Propertymark“The inquiry highlights the importance of regulation and the need to improve consumer protections. 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 exists 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 in 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.”
