Regulation of Property Agents: Creating a younger industry?
In this excerpt from our latest e-book, "Your guide to lettings and the law, Vol II", the move towards regulation of estate and letting agents has progressed in 2020, with a consultation on the Code of Practice - and agents are looking ahead to the changes the regulation may bring to the industry.
The Regulation of Property Agents (RoPA) was first proposed in 2018, with a working group laying out a new regulatory framework in the RoPA Report, published in July 2019.
The recommendations aim to “prevent bad practice and drive cultural change within the industry”. The licensing of agents will prove their qualifications and credentials, while the code of practice will “set out clear standards of behaviour”.
Progress was made in 2020, with a consultation launched in July to request feedback from agents around the draft Code of Practice, which covers the two main sections of “Dealing with consumers” and “Managing businesses and staff”. The code will apply to both the agency and its staff as individuals, and lays out a “framework for ethical and competent practice” for estate agents UK-wide, letting and property management agents in England, and others carrying out residential property work.
ARLA Propertymark’s feedback on the consultation included requesting more prominence for consumer complaints procedures; the need for more clarity in the phrasing on who the responsibility for upholding the code would fall - the agents as individuals or agencies as businesses; and the need for regular staff training to stay up to date. It also calls for more emphasis on the role that the property sector plays in meeting the government's target for net-zero emissions by 2050. The consultation closed in September 2020.
These upcoming changes and the qualifications required to work in the sector may make the industry more appealing to the younger generation as a long-term career path, says Darshan Sunger, Managing Director at Three Oaks. “There’s now scope for a younger generation to get a proper qualification,” he says. “It’s a career with a required entry level.”
At the other end of the scale, Sunger thinks there’s a risk that the industry may lose the accumulated knowledge and experience of those long term industry professionals who don’t wish to take the qualifications. “Some agents have a vast amount of experience, but they don't want to go back to school,” he says. “So they'll end up selling their business or leaving the industry.”
Despite the all-encompassing nature of these regulations, many agents anticipate little impact on the industry because lettings professionals should already follow best practices. “Agents should be regulated anyway, and all the good ones are,” says Chris Toynbee, Director at Redmayne, Arnold & Harris. “The more progressive agents are also qualified and this too should be - and will become - a minimum requirement. Those who aren’t regulated will need to step up, so, if it does have an effect, it will be a positive one.”