Almost one in five landlords do not trust letting agents to handle rental income and tenancy deposits correctly according to new research from The Letting Partnership.
The study, based on responses from 890 landlords across England, found that 19% lack confidence in agents’ ability to manage client money, highlighting an ongoing trust gap within the lettings sector despite increasing regulation and compliance requirements.
While most landlords remain confident in their chosen agent, the findings suggest concerns persist around the handling of rental income, tenancy deposits and wider compliance responsibilities.
The research also points to a communication problem. Although 66% of landlords believe their letting agent clearly explains its compliance credentials and professional standards, more than a third (34%) do not.
COMPLIANCE REVIEWS
Awareness of independent compliance reviews appears particularly low. Three quarters of landlords (76%) were unaware that some letting agents voluntarily undertake independent reviews of their client accounting and operational processes.
However, landlords appear highly receptive to greater transparency. Almost every landlord surveyed (99%) said that an independently verified compliance review would increase their confidence in a letting agent.
The findings come at a time when agents are taking on increasing compliance responsibilities on behalf of landlords following the introduction of the Renters’ Rights Act and wider regulatory changes across the private rented sector.
TRUST VALUE
Chris Mason (main picture, inset), Chief Operating Officer of The Letting Partnership, says: “Trust is one of the most valuable assets any letting agent can have, particularly when landlords are entrusting them with rental income, tenancy deposits and increasingly complex compliance obligations.
“What our research shows is that whilst most landlords trust their letting agent, there is still a sizeable minority who remain unconvinced.
“More importantly, there appears to be a significant lack of awareness around the independent reviews and compliance standards that many agents already undertake to demonstrate they are operating above board.”
RIGHT SAFEGUARDS
And he adds: “The fact that almost every landlord surveyed said an independently verified compliance review would increase their confidence demonstrates that transparency matters.
“It’s not enough to be compliant; increasingly, landlords want evidence that the right controls, processes and safeguards are actually in place.
“For agents, that presents a real opportunity. Those who can clearly demonstrate how they manage client money, maintain compliance standards and independently verify their processes will be best placed to build trust and differentiate themselves in an increasingly competitive market.”
The findings suggest that while compliance standards may be improving across the industry, many agents could do more to communicate those standards and demonstrate how client money is protected.
