How can letting agents cope with growing regulatory scrutiny?
17 August 2015 1656 Views
The growth of the PRS has provided a long list of benefits for the lettings industry. However, it is not without its challenges too. As more people live in the sector - it has already overtaken social housing and PwC has forecast more Brits will rent than buy by 2025 - scrutiny from the government and regulatory authorities will naturally increase.
There is already plenty of evidence of this. Debates surrounding PRS regulation take place in the media almost every week and while the Conservatives' victory at the election means there is no prospect of the introduction of extreme measures such as rent controls, the government is increasingly turning its eye towards the way in which the rented sector is run.
For example, a consultation has recently been launched that seeks to gauge opinion on the creation of new measures to clampdown on rogue letting agents and landlords. Among the suggestions is the introduction of a blacklist of rogue operators and harsher punishments for the worst offenders, extending Rent Repayment Orders and introducing civil penalties.
Another story that received media attention is the introduction of a controversial landlord licensing scheme by Harrow Council. The local authority's Selective Licensing scheme will require landlords to make monthly inspections of their properties and both the property owner and tenants will have to allow the council to undertake compliance checks with just 24 hours' notice. It's safe to assume the task of carrying out these checks will often be passed over to letting agents.
Factor in the Right to Rent immigration checks regulation, which is due to be rolled out nationwide at some point in the near future, and it's clear that there is a growing regulatory burden on the PRS.
Easing the burden
So what can letting agents do to cope with this increased level of scrutiny? The obvious answer is to provide a professional and law-abiding service that operates within the rules at all times. The vast majority of agents already do this and, despite the media attention, rogue operators remain very much in the minority.
However, even the best letting agents are likely to find the growing regulatory burden will result in an increased workload, particularly when Right to Rent is rolled out and if the licensing scheme employed by Harrow Council is replicated elsewhere.
Being able to keep on top of this increased workload will be vital both for taking advantage of the growth of the PRS and ensuring the agency stays on the right side of the law. In such an environment, it's key that letting agents are using the best possible technology. Relying on systems that were not built with the needs of the modern agency in mind will likely prove ineffective, time consuming and costly.
Utilising tailor-made letting agent software that utilises the latest technology such as cloud computing is one of the best things letting agents can do to ensure they are ready for increased regulatory scrutiny and the increased workload this will bring.
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