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Graham Awards


Redress scheme makes £25,000 award after “failings” by lettings agent

The Property Redress Scheme, one of the two government-backed redress operators for the lettings and sales service, has outlined its work in 2018 - and it’s given details of its largest compensation award, against a lettings agent.

The identities of the landlord who brought the complaint and the agency about which the complaint was made are not revealed by the PRS.

But in the PRS annual report, released today, the scheme says of the case: “The Landlord claimed for considerable rent arrears, as well as for the costs of a bridging loan which was taken out to cover the shortfall. The PRS Head of Redress found that there were considerable failings on the part of the Agent in respect of their duty of care and professionalism, and in light of the amount of the rent arrears, plus the behaviour of the Agent, made the highest award possible under the remit of the PRS [£25,000].”


The report also outlines which regions its expelled members came from: again, few specific details are given but 48 per cent of those members expelled in 2018 were from the London region, and 14 per cent from the North West of England.

It is impossible to make like-for-like comparisons between the 2017 and 2018 PRS cases and decision because the PRS (along with The Property Ombudsman) saw an increase in members when a third redress service, Ombudsman Services: Property, pulled out of the sector leaving its members obliged to move to an alternative provider.

However, the PRS stats show that of the 9,292 agent offices signed up to the scheme some 76 per cent are registered for lettings and 47 per cent registered for sales (so there are some registered for both). The overall PRS agent membership shows a substantial rise from the 6,787 in 2017.

Last year the average award made was £1,102.83p; of those complaints about lettings agents, 11 per cent concerned a breach of duty of care, 10 per cent were about poor service and complaint handling; and eight per cent were about general communication issues and on agent fees.

On the sales side some 11 per cent of complaints were about misleading or incorrect information, 10 per cent were about general communications, and six per cent were about unfair contract terms.

The PRS’s advisory council chairman, Lord Monroe Palmer, says in his forward to the annual report that “in this industry, the pace and scale of change has been unprecedented.”

He continues: “The number of reforms and level of legislative activity has not been seen in the private rental sector since the 1988 Housing Act. By the time the changes are completed, over the next few years, we will have seen as great an impact, as the then ground- breaking law over 30 years ago. It is also true that all other parts of the property sector are now under scrutiny – sales, leasehold and new build properties.”

Lord Palmer says that while the cause of this change is politics, it is exacerbated by a simple shortage of homes compared to demand.

However, he concludes: “The changes that are being made are probably overdue. Introducing better protection of consumers, who are ultimately customers of us all, is part of a healthy and vibrant market. We are also living in a world of innovation and technology that is impacting our lives, mostly positive but sometimes unpredictably, and with unforeseen detriment. The law is, therefore, struggling to catch up.” 

  • Paul Smithson

    Having dealings with the PRS i can advise that they just avoid any evidence put by the Agent and will just award to the tenant or landlord, it's a case of prove your guilt against the tenants word.

  • S l
    • S l
    • 05 June 2019 17:39 PM

    The shortage of housing is also due to the shortage of social housing which the government are pushing to the BnBs and also PRS which are cheaper than BnBs and hotels. Plus the fact that the council are making huge losses in dealing with the social housing and because its on taxpayers money, it does not bother anyone but it does bother me!!! And instead of making a profit for my pension, i am making huge losses year after year with these new licensing schemes and the constant new laws and regulations bashing the prs

    • 05 June 2019 18:29 PM

    Would you be better off by becoming a lodger LL!!!?
    So convert or reduce to just residential properties.
    Then with no more than 4 lodgers so no Mandatory HMO regulations or silly S24 issues etc.
    You can have as many Residential properties as you wish though only one of them would you be entitled to tax free Lodger income up to £7500.
    But even if taxed on other lodger income still a lot cheaper than S24 and silly licensing schemes.
    Time to dump AST lettings and convert to lodgers.
    I doubt many councils are having much success in persuading LL to take on HB tenants especially those on Council lists.
    Many LL like me are actively and legally DISCRIMINATING against HB tenants.
    Most of them are unviable.
    So I don't see how Councils consider they will be able to mug LL into taking on HB dross!!

  • S l
    • S l
    • 06 June 2019 08:41 AM

    unfortunately in southwest, the council only allow 2 lodgers if you live in the house. if 3 lodgers, the household would be subject to licensing as a hmo and treated as such. I had been specifically told by the eho officer who inspect the house because i put only 2 students in one house and these students are very naughty. They told their friends to live with them upstairs as its empty with only one lodger, the landlord lives in the backroom downstairs and only come back on weekend if at all. The EHO threaten to sue landlord in court unless he sign a letter of admission on the spot when he came to inspect. This is evidence obtained under duress. But because landlord a non white and did what he is told, now he is under huge pressure not to be caught off guard not following even the tiniest rules or law on prs. I would say this particular EHO is abusing his position and his power over the unsuspecting landlord who are only trying to obey the authority which is rather stupid to say the least. The EHO are not there to help. He was there to catch him and use him as an example to sue in court despite his being diligent as he can be with only 2 lodgers.Beware and Be warned! These EHO are suppose to guide and help not just impose their powers to sue!!

  • icon

    Let them take the case to court i say and show the court what a incompetent load of bullues they are. In Southeast 3 persons acceptable below 5 stories. All the councils are a bunch of useless half wits and thieves. Steal Council Tzx using their stupid rules.

    S l
    • S l
    • 06 June 2019 09:21 AM

    Completely agree. Gone are the days when the council are staff with people who are reasonable, not aggressive abuse their power using tax payers money as pay cheque and fleece tax payer more on council tax increase and empty properties. All council rules should be the same up and down england. Doesnt make sense how some council like SW can be so draconian! its all down to the attitude of the boss in the department i guess. Just show that SW are not great council staff and not user friendly either. More in showing off the powers they are given and they made up themselves

  • icon
    • 06 June 2019 09:54 AM

    No council can impose HMO regulations on a residential property where there are 4 unrelated adults including the homeowner.
    Tell the EHO to f off.
    None of his business.
    When 5 unrelated occupiers then Mandatory HMO licensing and it does become his business.
    It is a residential property not a letting property.
    There is no issue with 3 unrelated lodgers in a 4 bed house.
    It is even more ridiculous as no EHO would know how many lodgers a homeowner has unless someone tells them.

    S l
    • S l
    • 06 June 2019 10:41 AM

    unfortunately, the neighbours dont like non white living amongst them let alone let the rooms out. They had contacted the council and the council stop by unannounced and talked to the students who apparently didnt tell them anything. When landlord got a letter, he was a little confused until the council came and start asking everyone questions including the non legitimate lodgers who are there which the landlord did not know about and when asked to leave they refused!! very strange people think they can stay there without the landlord consent just because they know the landlord dont have time and wont be there monday -friday and most weekends when he have to work overtime. In SW, one are required to have hmo licence if more than 3 unrelated individual of more than 2 household. you can check the BANES website but cant challenge them or will incur the wrath of the eho. They even went on to issued a letter for attending interview under caution , same powers exercise by the police! If you refused to attend, they will inform the court who will use it against the landlord. If you do attend, they will ask questions and will use your answers to twist it to suit their case against the landlord. So its a lose lose situation for any landlord and especially ones with lodgers without any legal knowledge as to how he would be sued and end up with a criminal record. Legal fees would go up to the thousands just to get them to attend with the landlords. even then , the lawyer does nothing to defend the landlord or advice how to defend himself. I would say that these other people are intruders and not his lodgers and have no contractual relationship with him and go from there. considering that he is not in most of the time, his lodgers took advantage of his situation and created a hmo which should not be used against him. But the EHO do not care, they thought they caught him red handed and use duress to get a signed confession. How wrong is that. How should i advise the landlord? at least to get back the signed confession under duress back from the council to stop it being used in court in the future against the landlord

    S l
    • S l
    • 06 June 2019 10:45 AM

    I agree with you but the court have a tendencies to lean towards the authorities or those in uniform despite the evidence. The lay person would be forced to spend thousands on legal fees with no recourse for claims for legal fees as its against the authorities and councils. How wrong are the laws to work against its own citizens and residents and allow those in power to get away with murder, so to speak. The court do not consist of those with legal knowledge, finger cross they have impartial views and common sense with reasonableness to come to an objective decisions but you will see from a lot of courts cases recently that this is not the case. In fact, one start to wonder why bother with court when they are not impartial and have no legal or factual knowledge on interpretation of the law and the evidence presented in front of them;

  • icon
    • 06 June 2019 11:05 AM

    As the homeowner I would tell the EHO to get stuffed.
    In an Additional Licensing area a homeowner does not need to licence his home if there are three unrelated occupiers which there would be with one LL and two lodgers.
    There is no requirement for lodgers to be licensed until there are 5 unrelated occupiers who have to be actual lodgers including the homeowner.
    No EHO may specify how many days a homeowner occupiers their home which could be one of many
    Guests don't count.
    Guests don't have any linkage with the property.
    A guest may stay up to 140 days at 30 day periods.
    Will the EHO be parked outside permanently to check on a guest!!?

  • S l
    • S l
    • 06 June 2019 11:10 AM

    Landlord was also told that since got lodgers in the house, landlords are not allow any guests as it is treated as hmo!!! How absurd is that.I can only assume that because the lodgers got 3 other friends to moved into the house, the EHO then treat it as hmo and told to get licence. and to sign a confession under dureess or get sue in court However, when landlord apply for hmo licence with only 2 known lodgers, he was told by the office not to apply until the officer had attended knowing that they wanted to catch him red handed. very nasty.

  • icon
    • 06 June 2019 11:42 AM

    Once you have 5 unrelated occupiers then Mandatory HMO regulations apply which is fair enough.
    I doubt many 5 bed properties could meet HMO room size standards
    Which is why most homeowners will have 4 occupiers.
    But there is nothing to stop the homeowner having a guest in the 5th bedroom.
    The EHO had a very poor understanding of the law
    Certain types of lodger don't count either.
    See the posts of Gary Hodge on propertytribes.
    He is expert on all things lodger

    S l
    • S l
    • 07 June 2019 08:48 AM

    Thanks paul, He had since got rid of the rest of the lodger's friends and make them pay for the time they had used the room which was paid to the lodgers. These uni students are very enterprising with things that dont belong to them. Will check out property tribes. many thanks paul.

  • icon

    Hey folks LA trying to charge £500 plus Vat for tenant find only on £850 rent?


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