The House of Lords Industry and Regulators Committee is pressing the government to move forward with the establishment of a property agent regulator. This comes four years after the government first pledged to create such a regulator.
In a letter sent to the Housing Secretary Michael Gove, the committee expresses concern that the delay in establishing a regulator is harming tenants, leaseholders, and others by leaving them vulnerable to poor practices in the industry.
The committee, after receiving input from advocates for tenants and leaseholders, property agent professional groups, The Property Ombudsman, the Leasehold Advisory Service, and National Trading Standards, concluded the following:
- A new regulator would significantly improve industry standards and take action against agents involved in misconduct;
- Presently, enforcement and options for grievances are reactive and don’t cover all issues;
- The Leasehold and Freehold Reform Bill does not fully address leaseholders’ problems and should be complemented by stricter regulations.
Therefore, the committee recommends promptly enacting legislation to create a new property agent regulator or at least requesting a comprehensive governmental reply to the Working Group’s report that initially suggested such an establishment;
- It advocates for obligatory training for property agents, especially on ethical consumer interactions;
- The committee suggests that the new regulator enforce industry codes of practice that prioritize beneficial outcomes for consumers;
- It also wants an agreement on a Memorandum of Understanding between the new regulator, National Trading Standards, and redress schemes to work together and prevent overlap;
- The lawmakers urge the government to pass laws ensuring that consumer voices are strongly represented in the industry;
- They also call for the approval of a single ombudsman service for property agents to replace the two competing entities currently in place;
- Finally, they propose that, after initial governmental support, the new regulator should be self-funded through fees or levies on the regulated parties.
Baroness Taylor, Chair of the Industry and Regulators Committee, commented that the inquiry revealed an overwhelming consensus among consumer groups, the industry, and existing authorities on the need for a new statutory property agent regulator for property agents.
She criticized the government for its inaction over the past four years on the Working Group’s report and highlighted the negative consequences of weak regulation on tenants and leaseholders. The sector, she said, is in a state of uncertainty.
Additionally, Baroness Taylor expressed disappointment at the lack of a departmental minister to provide oral evidence during the inquiry.