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Industry calls for full regulation of letting agents

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  • 16/03/2015
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Some 84% of brokers believe letting agents should be fully regulated, according to a poll carried out by Mortgage Solutions.

In its manifesto, the Labour party has proposed to ban letting agents from charging fees to tenants and to ensure greater transparency of fees charged to landlords.

Just 16% of respondents to the Mortgage Solutions poll did not believe the industry needed compulsory regulation.

Simon Ryan, a landlord and managing director of Social Advisers, said greater landlord protection was required, particularly with a number of retirees predicted to cash in their pension and purchase buy-to-let properties.

“At the moment all the rights sit with the tenant, it’s much harder to evict a tenant now because a local authority won’t do it until you have court orders and so forth. So tenants are protected, landlords aren’t and we’re going to have landlords losing their pension pots if the industry is unregulated,” Ryan said.

“If we think of people that are retiring now are going to invest in a buy-to-let property, an agent could collect all their money and then go bust. Even if everything the agent did was legitimate in the way they took on the landlord’s instructions, amateur investors won’t necessarily be aware if their deposit and money is not protected.”

Ryan added: “I don’t think whoever holds the balance of power in the next parliament will have a choice about whether or not to tackle this kind of regulation.”

The Association of Residential Letting Agents (ARLA) has called on the government for compulsory regulation of the private rented sector since 2013, a move it said could help “to tackle rogue agents and promote professionalism and basic standards”.

David Cox, managing director at ARLA, said: “Just because you rent a property it should not impact your levels of enjoyment, especially as there is such a high price to pay for renting. Unfortunately for tenants using unregulated agencies and encountering rogue landlords renting can become a constant battle and an unenjoyable experience.

“It will only be through qualification and ongoing professional development, backed up by appropriate regulation, that we will eliminate the rogue landlords and agents who blight our industry.”

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