Call to regulate lettings industry and generate £20m for economy
Published by Max Salsbury for 24dash.com in Housing and also in Regulation
Good news for landlords: 79% of tenants like them
The compulsory regulation of lettings agents combined with the introduction of professional standards for all agents could generate over £20 million for the UK economy a year, new research from RICS reveals.
At present, anybody can become a lettings agent without qualifications or any knowledge of the industry.
According to RICS, this means that tenants and landlords are potentially open to unscrupulous practice with no come back - and it is costing the economy millions every year.
RICS' believes that, following an initial set-up cost of £45million, the regulation of UK lettings agents and the introduction of professional standards for all agents to the industry would provide net benefits of over £20million per year.
And the independent body says that such new statutory requirements would pay for themselves within less than two-and-a-half years, by avoiding complex red tape while offering the consumer increased levels of protection.
Although agents who sell property are subject to loose regulation, the lettings industry remains unregulated.
RICS is now calling for the law to be changed to ensure that lettings agents fall under the same scrutiny.
The shadow housing minister, Jack Dromey MP, said: "[We call on] the Government to regulate residential lettings and management agents and to end the confusing, inconsistent charges regime, making fees easily understandable, upfront and comparable across agents."
Peter Bolton King, RICS Global Residential Director, said: "These findings demonstrate exactly why the government needs to act, not just to safeguard the thousands of tenants and landlords who fall victim to unscrupulous practice, but also to relieve pressure on the wider economy. It’s encouraging that the introduction of professional standards and new compulsory regulation proposals being sought by RICS, has support from other industry players and consumer groups, and has now received cross party support. But what we need now is action.
"RICS has long called for a single regulatory and redress system for letting agents, which this survey demonstrates is clearly supported by the overwhelming majority of consumers. Until this happens, we recommend that tenants use a lettings agent that is a member of a professional organisation, such as RICS."