Letting agents shoulder a major responsibility and can handle substantial sums of money.
Yet they do not have to be licensed or even belong to a regulatory body. As a result, rogue elements have entered the field.
The private rental sector is important. It has jumped by 62 per cent since 2001 with a noticeable increase in the number of families with children having to rent.
Buy-to-let is a significant investment area but both savers and renters entering the market need to be warned that up to 40 per cent of lettings offices are not regulated in any way.
Yet agents handle large quantities of money with private renting accounting for an estimated £14bn annually.
There are regulatory bodies, notably the Property Ombudsman Scheme (set up in the 1980s to clear out the cowboys) and the Association of Residential Letting Agents. Members of both organisations are bonded in the event of failure, meaning that client money including deposits and rent are safe.
Selling agents are legally required to join a redress and adjudication scheme as a condition of trade but letting agents have no such demand. This is a serious and overdue omission.
Agents who refuse to join a regulatory body have to register deposits with a Government-backed scheme and obtain a certificate which confirms a client’s online code prior to commencement of a tenancy.
Not surprisingly in such a field, complaints do arise and Christopher Hamer, the current Property Ombudsman, reveals that he handled 15,782 complaint enquiries last year – a 12 per cent rise on 2011.
The largest award amounted to £13,335 to a buy-to-let landlord whose agent placed an illegal tenant in her property and refused to take any action for months whilst the rental went unpaid.
Hamer ruled the agent had been “reckless”. If the investor had used an unregulated agent, no compensation would have been paid.
If the interested parties cannot protect the innocent, it is time the Government stepped in. It’s time this particular cowboy was run out of town.