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.
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.
“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 of poor regulation is being felt by tenants and leaseholders, and the sector has been left in limbo.”
Baroness Taylor of Bolton, Chair of the House of Lords Industry and Regulators Committee.
After hearing evidence from campaigners for leaseholders and tenants, professional bodies representing property agents - including The Property Institute, The Property Ombudsman, the Leasehold Advisory Service and National Trading Standards, over the last few weeks 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;
- current forms of enforcement and redress are reactive and limited in scope;
- 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;
- mandatory qualifications for property agents including dealing ethically with consumers;
- industry codes of practice operated by the new regulator, focused on achieving good outcomes for consumers;
- a Memorandum of Understanding to be agreed between the new regulator,
- National Trading Standards and the redress schemes to ensure cooperation and avoid duplication;
- the Government to legislate for statutory consumer representation in the sector to ensure their views are loud and clear;
- the Government to approve a single ombudsman for property agents, rather than two competing schemes as currently;
- the new regulator, after initial Government support, to fund its activities through fees, charges or a levy on those it regulates.
Baroness Taylor, Chair of the Industry and Regulators Committee said:
"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.”
Read more on the Committee and the recent oral evidence sessions here
The Industry and Regulators Committee is launching a short inquiry into the regulation of property agents.
The inquiry will examine the current approach to regulation of property agents in the residential sector, and in particular whether there should be a new regulator of property agents, as recommended by the report of the Regulation of Property Agents working group in 2019.
