Agents Redress Schemes in England

From 1st October 2014 it has been a legal requirement for letting and managing agents in England to belong to a government approved property redress scheme. Failure to do so may result in a fine.

The new law grants both landlords and tenants the right to independent redress if their agent cannot resolve a complaint to their satisfaction.

This means that anyone who feels they get a poor deal from their letting agent will be able to take their complaint to a redress scheme.

Guidance documents and website links can be found in the Additional Resources section below.

Authorised Schemes

The Government authorised two schemes:

1) Property Redress Scheme – website –  www.theprs.co.uk 

2) The Property Ombudsman- website – www.tpos.co.uk  

Failure to belong to an appropriate scheme may result in a civil penalty of up to £5,000, with local authorities responsible for policing compliance.

All letting and managing agents in England need to belong an approved scheme from 1st October 2014.

 

Who needs to join?

The requirement to join a scheme is aimed at people trading as a business and who carry out “Letting Agency Work” or “Property Management Work” on behalf of a third party.

It is not aimed at people who help friends or family members manage their properties on an informal basis.

The legislation defines “Lettings Agency Work” as things done by any person in the course of a business in response to instructions received from:

a) “a prospective landlord” seeking to find another person wishing to rent a dwelling-house in England under a domestic tenancy and, having found such a person, to grant such tenancy.

b) “a prospective tenant” seeking to find a dwelling-house in England to rent under a domestic tenancy and, having found such a dwelling-house, to obtain such a tenancy of it. This means it covers relocation agents.

“Property Management Work” is defined as things done by any person (“A”) in the course of a business in response to instructions received from another person (“C”) where:

a) C wishes A to arrange services, repairs, maintenance, improvements or insurance or to deal with any other aspect of the management of premises in England on C’s behalf, and

b) the premises consist of or include a dwelling-house let under a relevant tenancy.

 

There are some exclusions. For example, anyone who just publishes property adverts and help tenants and landlords

contact each other directly may not be required to join a scheme. Local authorities, housing associations and universities are also excluded.

 

How does it work?

If a consumer (landlord or tenant) is unhappy with the service they have received and wishes to make a complaint, they must give their agent a reasonable opportunity to respond to the complaint first.

If the consumer receives the agents’ final response to a complaint and remains unhappy, or the complaint is unresolved, the consumer may then refer the matter to the redress scheme to which their agent belongs.

The types of complaint that the schemes could handle, include:

• apparent breach of obligations

• unfair treatment

• avoidable delays

• failure to follow proper procedures

• rudeness or discourtesy

• not explaining matters

• poor or incompetent service

 

The role of the redress schemes is to resolve the complaint appropriately for the agent. They are not there to punish agents when things go wrong. The schemes decisions are binding on the agent and are enforceable in court.

The schemes can require:

• an apology

• an explanation of what went wrong

• a practical action to correct the problem

• a financial award

The schemes may also make recommendations to the agent so that it can avoid a similar situation happening again.

Each scheme has its own rules. Agents are advised to check the rules of the scheme to which they belong or are thinking of joining for details of specific requirements.