ARLA has said that voluntary moves to tighten up controls on rogue letting agents probably will not work, and that legislation will be required ‘to achieved full control of the sector’.
The organisation was responding to yesterday’s Ombudsman report for last year, revealing a big increase in the number of complaints about letting agents. The Ombudsman was unable to do anything about agents that did not belong to his scheme.
Ombudsman Christopher Hamer called for the setting up of a new council which would, among other things, help promote agents that belonged to recognised bodies.
His comments were carried on Estate Agent Today: for link, see below.
In response to the report, Ian Potter, ARLA operations manager, said: “As an organisation that strives to achieve the best possible standards within the private rented sector, we are disappointed to see a rise in lettings complaints over the past year.
“It was however interesting to note that only 10% of those merited adjudication by the Ombudsman, and it should also be noted that there were almost 900 new lettings members, despite some consolidation in the industry.
“That said, it comes as very little surprise given there is no national regulation in place to stop rogue agents setting up shop and taking advantage of what is a fragile market – 26% of complaints were against agents who did not belong to an Ombudsman scheme.
“We have long called for increased regulation in the sector, and as such, we are not unsupportive of the concept of a council to help promote consumer understanding of the importance of using professional agents like ARLA-licensed members.
“Ultimately, it is likely to require primary legislation to achieve full control of the sector and it will be interesting to see how the proposals in Wales and London progress.
“We would also encourage prospective tenants to ensure the agent they enter into agreement with is a member of The Property Ombudsman Scheme, which provides an additional layer of protection.”
http://www.estateagenttoday.co.uk/news_features/Rogue-letting-agents--we-cannot-let-situation-go-on-says-Ombudsman
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Comments
One thing that seems to be totally ignored when reporting statistics is the 'organic growth' as awareness of TPO and other schemes grows. These staistics are in no way a reflection that standards in the industry hace declined- in fact I feel the letting industry is far better on terms of service than it was just 10 years ago.
The wider knowledge of TPO will result in more reports. I would be interested to know how this compares to (say) their web traffic growth, membership growth and media features growth. If 10% of all Tenants (I am simply picking a random figure here) would file a complaint but in year 1 only 1000 tenants are aware of TPO but in year 2 1300 Tenants are aware of TPO then complaints go up by 30% by the representation of the industry (as a percentile) remains the same.
Figures like this are meaningless without being quantified.
Interesting to see ray Evans write that ARLA's staff is to vigorously promote members front line interests. I was at a regional meeting yesterday listening to Ian Potter giving us the results of a secret shopper poll. It was scary to hear that a majority of members aren't even promoting themselves.
I too have been guilty of sitting on my laurels in the past and saying "what are ARLA doing for me?" but it was made crystal clear to me yesterday that its is up to members to also take an active role in promoting regulation to the general public in their own area. We will be doing our part from now on and getting every agent to be part of the ombusdsman scheme will be part of that
Look everbody is moaning about regulation but nobody has suggested an alternative to cutting down on the agents who just don't know what they are doing, and that is a concern.
ARLA is wanting the government to regulate by bringing in letting agents into a compulsory Ombudsman Scheme and that can only be right.
ARLA does not and never did regulate it is attempting to raise standards, and believe you me, most agents need training as a matter of urgency.
Look everbody is moaning about regulation but nobody has suggested an alternative to cutting down on the agents who just don't know what they are doing, and that is a concern.
ARLA is wanting the government to regulate by bringing in letting agents into a compulsory Ombudsman Scheme and that can only be right.
ARLA does not and never did regulate it is attempting to raise standards, and believe you me, most agents need training as a matter of urgency.
All government regulation costs. Who always pays through the nose to keep civil servants and the like in high salaries and high pensions to administer it?
The regulated of course!
Anyone who asks to be regulated by government, for any reason, want their heads testing because it always grows like topsy, rarely works and costs more every year..
It probably isn't HUGE but I a glad you bit the bait.
Chris Hamer made a real bit thing about 1500 or so extra lettings complaints with a headline grabbing "26% rise in complaints" as just cause for his call for further regulation.
I can see why the figures were manipulated, 1500 extra complaints spread across the entire Lettings market isn't a very big percentage increase at all, certainly less than a 0.1% rise and even with that massive 26% increase less than 0.4% of all tenants have cause enough to complain. No wonder CLG say they see no reason for further regulation.
At a time when demand for rented property has seen a general rise in rents is it any wonder a slightly peeved public chooses to complain a bit more?
Call it what you will there is financial gain to be had from regulation so if it is fair and fit for one side to make exaggerated claims to support its cause don't be surprised if we who will end up paying make equally exaggerated claims.
Please explain this concept of a vote, that would indicate some sort of democratic process wouldn’t it?
@teena,
It is difficult to comprehend where the HUGE 'commissions' to which you refer emanate and who receives the benefit. Excluding the Law Society which, without being at all rude, is well out of this industries league from a regulatory perspective and always will be, there are only three CMP policies which are underwritten for the specific benefit of NFoPP, RICS & NALS. They discharge the 'premium' to the insurers (via a broker / Captive manager, who will indeed be remunerated in the form of commission). The total cost of participation (not a premium to the letting agent) is divided between those letting agents / members who are required to participate as a primary condition of their membership.
So, if the trade association involved is charging a disproportionate amount to cover, say, administration costs that doesn't qualify as commission. Therefore, take it up with your Trade Association, after all you have a voting right - don't you?
"At no point has the matter of who stands to gain financially from regulation been raised"
Yes it has Teena, in posts relating to a story covered last week it was mentioned that the insurance commission available to whoever is providing CMP is HUGE. The reason TPO are so anxious not to get left out of this feeding frenzy is very obvious. CMP commission will make Rightmove profits look like shrapnel.
If ARLA were raising it's profile, if there were less conflict and confusion between varying representative bodies, then public awareness would grow and the need for regulation would be reduced.
At no point has the matter of who stands to gain financially from regulation been raised - additional expense to agents, landlords and tenants - outstanding income for TPO or this 'council'. It should be a matter of integrity that any call for legislation is backed up by a plan for monitoring it's implementation. All that will happen otherwise, as happens with much PRS regulation, is that the good guys pay, and the bad guys carry on regardless.
Personally I would like to see Government/local authority regulation of letting agents and to see ARLA disappear for good.
I am not an ARLA member and never will be. I would happily submit to local authority regulation (fee or non fee-paying).
@Denise on 2012-03-15 09:05:22
I agree entirely with your comments.
ARLA (including the whole of NFoPP) have morphed into a "consumer protection" set-up. Their job and what we pay for, is for the staff to vigorously promote the members front line interests, obviously taking into consideration consumerism etc. but prioritising the members interests with less cosying up to government departments and quangos .
It is now March, I wonder what the break down of the numbers of RENEWAL memberships is for this year ?
What was he on Denise? I would like to catch it on Iplayer.
I watched Ian Potter on television last evening. As a Licensed ARLA member of long-standing I was really hoping that he would strongly recommend the use of ARLA agents. At the end of the interview he had only used the word "ARLA" once! It beggars belief that given prime air-time and the strongest possible support from The Ombudsman the opportunity to succinctly market the ARLA brand had, yet again, been missed. Sadly, I felt that his performance was very low-key and eminently forgettable.
If as much effort was put into marketing brand ARLA as is put into thinking up money-spinning conferences and training courses perhaps the Great British Public would know what ARLA stands for!