Eleventh hour reform for ‘Wild West’ industry

May 7, 2013

AC Forscutt, Northwood’s Compliance Manager, examines what the amendment to the Enterprise and Regulatory Reform Bill means for you

“Wild west agents outlawed”, “A win for tenants’ rights”… You’ll have seen the headlines that resulted from the recent (Tuesday 16 April), eleventh hour amendment to theEnterpriseand Regulatory Reform Bill, meaning all letting and management agents in the private rented sector must now offer landlords and tenants access to approved redress schemes.

In other words, letting agents will have to belong to an ombudsman scheme like The Property Ombudsman or Ombudsman Services Property.   As a further measure, The Office of Fair Trading will also have powers to ban those who act improperly.

Without doubt this is a big step forward in improving standards in the industry and protecting tenants and landlords, but let’s be clear: the amendment won’t be enough to eradicate the rogues completely.

Landlords must still be wise when choosing an agent to ensure that their money is protected.

So what should you be looking for? 

  • Client money protection (CMP) insurance is key.  This is your safety net should a letting agent close down suddenly or abscond with your funds.  Look out for the SAFEagent campaign and logo which signposts those letting agents that subscribe to a CMP scheme.
  • Also make sure that your deposits have been paid into one of the four Government-approved tenancy deposit protection schemes – mydepositsTenancy Deposit Scheme (TDS)Capita Tenancy Deposit Protection or the Deposit Protection Service (DPS).
  • Membership of a voluntary licensing scheme or body, such as NALSARLA and RICS, can identify those letting agents which are committed to going the extra mile for professional standards.

It’s a well-known fact that it’s a buoyant time for rentals with the averageUKrental yield now standing at 6.2%.   In the first quarter of this year alone, average rents rose, rent arrears fell and lettings times became faster.  But is any of this really important if your money isn’t safe?

Northwood, a founding firm behind the SAFEagent initiative prides itself on operating with integrity and doing things the ‘right’ way.  Each Northwood Office must operate under strict codes of practice.  All of our systems are checked annually by Trading Standards and we have been a member of The Property Ombudsman for many years.

This, combined with Northwood’s Guaranteed Rent service ensures that rental payments are met each month without fail, guaranteeing that landlords receive a risk free rental experience.

For more information visit www.northwooduk.com

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