There would appear to be something of a sea change underway regarding letting agents.
After years of languishing in relative political obscurity, Westminster has recently played host to an array of debates, Private Members Bills and Ten Minute Rule motions, with MPs from all sides calling for reform of the letting agents market.
On top of that, in a landmark announcement, the Advertising Standards Agency (ASA) has today ruled that letting agents must be more transparent about the fees they charge tenants.
These are all welcome developments. And with the private rented sector (PRS) growing fast, the way that the letting agents market operates will only increase in prominence and urgency.
While fees remain most tenants’ top concern, however, the fact that many letting agents have for years got away with standards of practice far below that which we would expect of other professions should not escape our attention.
This is something that the House of Lords today has the chance to act decisively on. With all that is going on in the world and, I’m sure, in your life, you would be forgiven for letting Day 3 of report stage of the Enterprise and Regulatory Reform Bill slip you by. And indeed the proposed amendment 81A, tabled by Baroness Hayter.
But if successful, this could provide a further vital step towards a private rented sector that works in the interest of the nine million people living there.
Around 66% of private tenancies in this country are secured through a letting agent. At present though, should you walk through the door of one of the many letting agents on your high street and rent a home, you will enjoy no real or reliable consumer protection.
If the letting agent leaves your house in disrepair, your phone calls unreturned or just outright rips you off, you have no guaranteed access to independent redress. You will have no right to have your money protected. Very little will (or can) likely be done to punish those who consistently subject you and others to poor practice.
However, if you walk into an estate agents and buy a home, you will be assured of all those things. They are provided for by the Estate Agents Act 1979, and more recently the Consumer, Estate Agents and Redress Act 2007. There is proper consumer protection for people who buy their homes, but not for those who rent them.
Sadly, we know that this is all too sorely felt by renters. Surveys for Shelter as part of our Letting Away With It campaign show that only 20% of renters agree with the statement ‘I trust my letting agent to do their job’. 84% disagree with the statement that ‘letting agents work in the interest of their tenants’.
These stats are backed up by a litany of grim case studies in both Which? [PDF] and CAB’s [PDF] recent reports – stories of boilers going unfixed, as well as letting agents being unreachable or disappearing with people’s money.
The proposed amendment would close this loophole by bringing letting agents under the scope of the Estate Agent Act 1979 and CEARA 2007. Proving that this is not an issue of party politics, the proposal gained wide cross-party support when it was discussed at Grand Committee, including from Lord Deben (John Gummer), a former Secretary of State under Margaret Thatcher.
Of course, not all letting agents mistreat tenants. A majority belong to voluntary professional bodies and trade associations. However, around 40% of the market operates outside this self-regulatory framework. Predictably these are often the worst offenders, and they damage the reputation of the entire sector – which is why letting agent bodies are backing Baroness Hayter’s amendment too.
But for the time being the Government have set their face against the proposals – and further reform of the sector in general – claiming it represents ‘red tape’. In this respect, they are very much on their own. They may have a rebellion on their hands this evening.
One thing’s for certain though. With letting agents rising fast up the public and political agenda, tonight’s vote won’t be the last word on the matter.
