Does the property industry need a new regulator? News from Letting Agent Today;
An over-arching regulator for the entire property industry is not necessary, UKALA boss Caroline Kenny has said.
Last week, ARLA called for ‘accredited’ bodies such as itself, the NAEA, RICS and ARMA to be able to run licensing schemes and answer to a central regulator.
It said that all agents should have to belong, by law, to one of these bodies and to be licensed by them.
ARLA also called for all private landlords to have to register, saying that by law they should have to belong to a landlord scheme such as the National Landlords Association and the Residential Landlords Association.
ARLA proposed that the over-arching regulator should be the Property Ombudsman. It also criticised the proliferation of bodies currently operating in the sector, saying that this confused consumers.
But Caroline Kenny, executive of UKALA (the UK Association of Letting Agents), said that she did not believe a central regulator was necessary – although she supported other elements.
She said: “UKALA believes that regulation must be proportionate to the issues or problems it seeks to address and it appears that a more targeted response is necessary to challenge the negative experience of some and perception of many in the wider community.
“All of those living and working within the private rented sector should be able to expect certain minimum standards from professional agents providing letting and management services.
“This must include: professional indemnity insurance; comprehensive client money insurance; commitment to professional development; a robust complaints process with an independent provision for appeals; transparency and clarity of all terms, conditions and potential charges; and above all excellent customer service.
“UKALA requires that its members provide all of these reassurances to landlords and tenants and believes that all other agents should do the same. While we do not believe that a central regulator is essential to ensure these standards are met, we would support moves to make these features a mandatory part of all letting and management services. In practice these elements exemplify the type of practices and security at the heart of most calls for statutory regulation.”
She added: “Given the inevitable cost of any intervention intended to provide an assurance of minimum professional standards, it would be beneficial to reduce the cost to be borne by firms in the industry and potentially consumers.
“Furthermore, it stands to reason that using appropriate existing bodies to deliver positive outcomes should represent better value for money than attempting to construct an over-arching regulator.”
Ian Potter, managing director of ARLA, said: “We are not saying our model is the only way – we welcome the views of the wider industry and are open to debate as to which body would prove most apt for industry oversight and how regulation could, and should, work.”
Potter said: “Regulating the sector is a complete win-win. Tenants will get better quality property and have their rights and money protected; the industry will be rid of unprofessional practice and enjoy a better reputation; and the Government will have a simpler system to oversee and ultimately fewer disputes to resolve.
“Failure to regulate will mean that rogue agents continue to blight the sector, damaging trust in the majority of responsible agents and resulting in poorer housing conditions and dwindling supply.”
ARLA’s call has been supported by shadow housing minister Jack Dromey, and by Peter Bolton King of the RICS.
Dromey said: “If Ministers refuse to act, the next Labour Government will. I have asked ARLA and the RICS to host with me a Private Rented Sector Summit to design how regulation of letting agents might best work. I want all voices to be heard as we build a private rented sector that works for all.”
Bolton King said: “We have long supported greater regulation in lettings to ensure consistency with sales, and welcome any move to highlight this debate. We, along with other industry bodies like ARLA, recognise the need to promote professionalism within lettings for the benefit of businesses and consumers, and believe clear and consistent mandatory regulation, targeted where the risks are greatest, is the best way to achieve that.”
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