It comes as something of a surprise to many people that there is no formal regulation of lettings agents or any form of structured consumer redress of protection scheme. Apparently, this is something that also bothers our elected representatives, or some of them…a little bit.
Some of the aforementioned elected representatives were seeking to use the Enterprise and Regulatory Reform Bill which is currently in Parliamentary ping pong as a vehicle to do this. I would try to explain what this Bill is actually intended to do but in all honesty it is such a hodge-podge of items the list would extend well beyond your reasonable tolerance. Naturally, this sort of Bill tends to become a vehicle for every interest group in Parliament to push one of their pet projects. This is what has happened with regulation of letting agents.
In the Lords a number of amendments were pushed forward, the most enduring of which was to extend the Ombudsman schemes for estate agents created by the Consumers, Estate Agents and Redress Act 2007 to lettings. The government opposed this amendment and has had it booted out by the Commons, instead wheeling in an amendment of its own which permits the Secretary of State to make an order requiring letting agents to belong to a redress scheme.
What this order will look like is unclear. It appears that a consultation is to come. However, Jo Swinson, for the government did perhaps drop a hint when she indicated that the schemes would “ensure that tenants have access to redress”. There was no specific mention of landlords. How such a scheme can impose a new legal duty on letting agents to provide tenants with redress when there is no legal relationship between tenant and agent remains to be seen. The consultation should be interesting.
*Apologies for the sarcasm in this post but I have started to develop a high level of frustration with ill considered and last minute amendments by governments which touch on housing and property matters.