Date Published 28 November 2011
Surprisingly not all estate agents are currently required to meet standards of compliance within the industry. This is particularly worrying to potential tenants and landlords who are unaware, unprotected and inexperienced in this often confusing market.
As a Member of The Guild of Professional Estate Agents, Lesters offer trust and confidence to tenants and landlords in a market that isn't regulated and where complaints are strongly on the increase. The Guild currently has approximately 80% of its members operating in lettings, which is a very lucrative area in the property industry right now, with the number of lettings agents in the UK expanding rapidly over the past three years due to a decline in property sales.
With rental properties in short supply it can be all too easy for an eager tenant to ‘snap up a bargain' and not worry too much about the record of the agent and landlord. Yet the Property Ombudsman recently reported that the number of claims involving lettings disputes has risen sharply. According to its 2011 Interim Report (1st Jan – 31st Aug) complaints against lettings agents (both members and non-members) totalled 5142, up 13% from 4,644 over the same period in 2010. Shelter has also reported complaints against rogue landlords increasing by almost a quarter in the past year rising from 70,813 to 86,628.
The rapid expansion in the number of lettings agents in the UK, over the past three years, is partly due to a decline in the volume of residential sales compared to the highs of 2007. This has led to many traditional estate agents expanding their offerings, and also to a rapid growth in tenants as the population grows, people moving around to find employment, and mortgages proving more difficult to secure. For many people, renting is currently the only realistic option.
This trend is expected to continue well into the future with the number of UK residents forecast to hit 70 million by 2029 according to the Office Of National Statistics, As a result, rents in real terms are rising across the UK, but especially in London and The South East. Many landlords can now effectively pick and choose their tenants from multiple applicants e.g. by the quality of references, potential tenure, or even whether they have any children or pets.
However, many first time tenants and landlords are unaware that the rules and regulations surrounding rentals can be complicated and demanding - and if things go wrong for any reason, this can quickly lead to significant stress, financial penalties, and in the most extreme cases, escalate to legal proceedings.
Most tenants depend on their estate agent to protect their interests, which is similarly true for landlords. However, it is not always transparent that a particular agent has the experience, moral compass, and fortitude to operate diligently and consistently.
Currently, agents involved in lettings only are not regulated by the 1979 Estate Agents Act – and many have been in the business for a relatively short time. There is no requirement for them to meet any standards of compliance nor is any accreditation qualification required. Tenants may never actually meet the landlord or tenant, so It is therefore vital to work with an agent that can be trusted, and Holly Weston Property Manager at Lesters recommends certain simple checks that can be performed; -
- Is the agent a member of a recognised tenancy deposit scheme?
- Does the agent ask for suitable references?
- Does the agent check that landlords have a suitable mortgage in place e.g. ‘buy to let'?
- Do the staff in the agency receive regular training?
- Does the agent visit the properties in its rental portfolio to check everything in order?
- Are the appropriate checks undertaken, such as gas safety and electrical testing at all the lettings properties?
- Are you clearly informed of your obligations, and the process and choices available should you have a problem?
- Is the paperwork clear, accurate, on time, and correct (including all contracts, and receipts for any cash / sums paid)?
- Is the agent part of a leading national network, such as ARLA, NALS, or The Guild of Professional Estate Agents?
In the end, perhaps the best test of all is for the tenant to decide whether they would trust their own property with this agent - for rental to a stranger. If the answer is yes, then the odds are the tenant or the landlord will be in safe hands