Are letting agents regulated?
Compared to other occupations, private sector letting agents were largely unregulated. The industry is subject to limited legal regulation, and rental and administrative representatives are not required by law to belong to business associations. We have been committed to stronger regulation of landlords for a long time. Only by ensuring that agents are properly qualified and meet minimum competency standards can consumer service standards be increased and bad practices in the industry eliminated.
There are currently no legal regulations regulating landlords. About half of UK letting agents are currently self-regulated. The most important rental agent organizations are the Association of Residential Letting Agents (ARLA) and the Royal Institution of Chartered Surveyors (RICS). They have codes of conduct and compliance controls that govern the activities of their members.
The Association of Housing Landlords is a professional organization that deals with the self-regulation of landlords. It was founded in 1981 and is involved in all aspects of renting and managing residential properties in the private rental sector. ARLA is widely regarded as a leading voice in the industry by government and consumer groups, media, scientists, and think tanks. The regulation of the letting and managing directors (England) (962 KB, PDF).
There is currently no overarching legal regulation in England for letting or managing directors of the private sector, and there is also no legal obligation for them to belong to a trade association, although many rental and managing directors are subject to voluntary regulation. In Northern Ireland, brokers are currently not regulated, but there are proposals for major changes in the private letting sector, including regulating brokers and banning tenant fees. Those who were dissatisfied with their landlord’s service or competence will no doubt be vocal in favour of regulation. While the picture for letting agent regulation in the UK is currently mixed, the entire sector is moving towards professionalism and accountability, providing the security and profitability that landlords and investors are hoping for.
Rent Smart Wales deals with training and property registration, while the Scottish government’s regulatory focus is on ensuring that every rental agent has the right skills to get the job done. There is currently no overarching legal regulation in England for letting or managing directors of the private sector. There is currently no overarching private sector lease or management legislation in England, but the government has announced that a regulation will be introduced. The Department of Housing, Municipalities and Local Government (MHCLG) has published a report on the recommendations of the working group’s proposals for a new legal framework for real estate agents across the UK and letting and management agents in England.
It uses the changing UK real estate market as the number of tenants increases as a justification for mandatory regulation in the rental broker market. What regulation could provide in addition to applicable law is a free, easily accessible body that effectively stands between the landlord and the courts and provides a customer-friendly interface that ensures that intermediaries comply with applicable law. Christopher Hamer, the real estate ombudsman, recently called for the legal regulation of rental agents in an interview with the Financial Times, Tanya Powley. The regulation itself would not necessarily ensure letting agents “act fairly,” unless there were additional levels of compliance, such as the code of conduct required by ARLA.