A new regulatory framework for property agents is on the horizon, following the publication of a report by a working group chaired by Lord Best, which included sweeping recommendations for regulation of the profession. These recommendations include the introduction of:
- a new, independent property-agent regulator
- a legally-enforceable Code of Practice for property agents
- minimum entry requirements and mandatory professional development for property agents.
We’ve put together a quick guide to the report’s key points.
A new, independent regulator
The working group recommended the creation of a new, independent regulator, after finding that there wasn’t an existing body that could fulfil this role. The new regulator should be accountable to the Secretary of State for Housing, Communities and Local Government, and publish and report annually on its “progress in raising the standards of property agents, using agreed key performance indicators, including consumer satisfaction”. The regulator should also have a range of options for enforcement, depending on the seriousness of any breaches of the law. The working group suggested options ranging from agreeing remedial actions and issuing warnings up to revocation of licences and prosecution for unlicensed practice.
All property agencies and “qualifying agents” carrying out “reserved activities” should be required to hold and display a licence from the new regulator, recommended the working group. Agents would need to adhere to a new Code of Practice to gain a licence, as well as completing minimum qualification requirements, which would be set out by the regulator. Continuing professional development would also become mandatory.
“Qualifying agents” would include sales agents across the UK, and letting and managing agents in England, as well as auctioneers, rent-to-rent firms, property guardian providers, international property agents and online-only agents. “Reserved activities” are those that only a licensed individual at a regulated firm can perform, which the report suggested could include conducting viewings; market appraisals; negotiating with and on behalf of clients; signing contracts; providing direct advice to clients; instructing contractors to undertake works; collecting or handling client money; and having responsibility for the health and safety compliance of a property.
A new code of practice
The report also recommended introducing new, legally-binding Code of Practice, which would apply to all property agents. Adhering to the Code of Practice would be key to obtaining and retaining a licence from the new regulator. Some of the recommendations for the Code of Practice included an obligation to maintain appropriate accounts and records of business activities; reporting breaches of the relevant code to the new regulator; and having an effective consumer complaints procedures in place.Read the full report at gov.uk.