New legislative changes will make it a legal requirement for all letting agents to register with a redress scheme.
The Department for Communities and Local Government (DCLG) has approved The Property Ombudsman (TPO) to provide a free and independent redress service to landlords and tenants as part of new legislative changes affecting letting agents.
Today’s announcement by Housing Minister Kris Hopkins follows the government’s decision to make it a legal requirement for all letting agents and property management agents in England to be a member of an approved redress scheme. It is expected that this legal obligation will come into effect later this year.
To date, more than 11,000 letting agents have already registered with TPO and are voluntarily following the standards outlined in TPO’s Lettings Code of Practice, which enables consumers who are dissatisfied with the service provided by registered firms to have their complaints independently investigated and reviewed by the Ombudsman.
The Ombudsman, Christopher Hamer, The Ombudsman said:
“As the largest redress scheme in the property sector I am naturally very pleased that TPO has received official recognition from the government as an approved redress scheme. With 60% of UK letting agents already in membership with TPO this will mean no change for them.
“However, TPO experienced a 34.2% increase[1] in the number of consumer enquiries relating to letting agents not registered with TPO during 2013, which really underlines the importance of mandatory redress for letting and management agents.
“Whilst my role as Ombudsman means that I am not a regulator and I can only review complaints after a dispute has occurred, making redress a legal requirement for lettings is a positive move to enhance consumer protection. Clearly it would be better if complaints did not arise in the first place and robust legislation to enforce controls was in place.
“That said, the Government has been quite clear about their desire to see the industry self-regulate and I believe that compulsory redress is one of the many safeguards needed for consumers.
“We will now emphasise to agents not currently registered with a redress scheme the benefits of joining TPO, not the least of which is that those agents will be able to demonstrate to their landlords and tenants that they follow the comprehensive set of standards contained in the TPO Code of Practice – the only Code of its kind in the industry – and we look forward to welcoming many more agents to the scheme following our government approval.”
Bill McClintock, Chairman of the TPO Board, said:
“Compulsory redress for letting agents is a big step in the right direction to give consumers a free, fair and impartial route to resolve disputes. These changes will bring a level playing field for letting agents, following years of campaigning from TPO and the industry.
“We are delighted to have government approval and look forward to being able to use our 24 years of experience to offer even more consumers peace of mind that if they use a TPO registered agent they can access a free dispute resolution service.”
* The Ombudsman published his 2013 Annual Report today, which includes consumer case studies and a number statistics on the UK lettings market concerning enquiry volumes and cases supported, complainant analysis and trends concerning the types of issues reported by landlords and tenants. To view the annual report, please visit: http://www.tpos.co.uk/annual_reports.htm

[1] TPO 2013 Annual report http://www.tpos.co.uk/annual_reports.htm