Is rental market working? 'No' say most...

Is the rental market working? An overwhelming majority – 94.8% when we last looked – say no.

The Guardian has been running a poll – Is the Rental Market Working? – which was open for voting until the end of yesterday.

The results look interesting, although the Guardian failed to ask some key questions – nothing, for example, on whether people thought landlords and/or agents should be regulated, and nothing on whether agents should be legally compelled to keep client money in separate, untouchable accounts.

But the poll did show that most people (42.5%) think that increasing housing supply is the answer; others (21%) want to see tenants’ rights improved in line with the EU – whatever that means; a reasonably strong body of opinion (20.6%) thinks the answer is to raise taxes on second homes; but long-term tenancies aren’t seen as an option, with only 6.7% of voters wanting them to be encouraged and only 0.8% wanting mortgages to allow long-term tenancies.

Perhaps most concerning is that only 6.7% believe that all letting agents should be forced to join a redress scheme.

Redress, of course, is not the same as regulation, and a truly aggrieved tenant or landlord may not win as much as they would get in court – or have the satisfaction of seeing the agent named and shamed.

However, as you can imagine, Property Ombudsman Christopher Hamer certainly had something to say when asked by The Guardian.

He said a decisive no in answer to the question as to whether the letting market is working.

He said: “Whilst the market is currently buoyant, there is little protection for tenants and landlords from rogue letting agents.

“The Consumer and Estate Agents’ Redress Act 2007 obliged all estate (sales) agents in the UK to sign up with a redress scheme. As a result, standards have consistently risen.

“In 2007 my awards for sales cases averaged £547 with a 65% support rate in favour of complainants; now the award average is £258 and that support rate has reduced to 50%.

“This is a clear sign that, whilst mistakes still occur, estate agents are following the required standards of the TPO Code of Practice more closely and providing a better service to their clients.

“Unfortunately, there is no such legislation that compels letting agents to join a redress scheme.

“Whilst we estimate that 60% of letting agents in the UK have registered with TPO and are adhering, on the whole, to the requirements of the Code of Practice, this leaves approximately 40% of letting agents who are applying their own individual standards to the service they are offering their tenants and landlords.

“This is one of the loopholes which encourages rogue agents to operate within the industry.

“A formal regulatory structure would set a level playing field for all letting agents and would benefit tenants, landlords and, ultimately, the agents’ own businesses.

“However, in the continued absence of the Government’s focus on such a structure, compulsory redress would be a starting point to assist in the protection of consumers.”

The Guardian did find some experts who believe the rental market is working. Among them is landlord Philip Stewardson, who points out that without the private rented sector, the housing market would have ‘totally collapsed’.

David Newnes, director of LSL, says that high rents are not a failure of the market but simply a function of economics. He predicts that as more landlords invest in the buy-to-let market, prices will come down.

Voting has finished but some of the 180-odd comments are worth reading, as are the final results (updated from the ones we give, taken at lunchtime yesterday).