Public do not understand why letting agents are not regulated, MPs told

Public do not understand why letting agents are not regulated, MPs told

MPs have been told of tenants’ bewilderment when they go into an estate agent to find that staff selling houses on one side of the office are regulated, and their colleagues who are letting homes are not.

Tory MP Mark Pawsey, who represents Rugby, said it was one of the most compelling pieces of evidence considered by the CLG Select Committee reporting into the private rented sector.

Pawsey was on the committee, alongside its chairman Clive Betts, who presented the report – which calls for wholesale reforms – to the Commons.  

Betts said that many landlords do an excellent job, and efforts need to target rogues. He also said there was a real need to crack down on bad letting agents.

Betts also criticised letting agents’ fees charged to tenants, saying that “many” were unclear and unreasonable.

He said: “The first step has to be transparency. Wherever a property is advertised to let –in a window, on a website or in a newspaper – it should be accompanied by a full breakdown of the fees that a tenant is likely to have to pay.

“No more hooking the tenant with a property that they like, and then, once they are interested and are looking to sign the tenancy agreement, letting the hidden fees come out, little by little – drip, drip.

“We are talking about costs that the tenant never anticipated, and that can run into the hundreds of pounds. Also, there should certainly be no more charging the landlord and the tenant for the same service; that is completely and utterly unacceptable, and should be banned.”

Betts said that councils should have more freedom over licensing schemes, and should be given powers to force landlords to join accreditation schemes – all of which are currently voluntary. He singled out an accreditation scheme in Leeds as being excellent.

The committee’s report main recommendations include the regulation of all letting agents, making both professional indemnity and client money protection insurance mandatory, and making electrical safety checks mandatory.

The committee says letting agents’ fees should be deemed illegal if they are not properly spelled out, but says it may go further than this. It will take a look at Scotland, where fees were banned last winter, and return to the subject next year.