Estate Agents
- rogues could be gazzumped by the law
Time is running out for dodgy estate agents. The campaign for stricter mandatory
regulation to run them out of business is attracting more supporters.
Lenders are the latest to support the Move It campaign launched by the Consumers'
Association, in March following the report on estate agency by the Office
of Fair Trading (OFT). The Association's journal Which? called the OFT's
conclusions "woefully inadequate".
The OFT's recommendations, made after a two-year investigation, were that
agents should use plain English in contracts and keep written record of offers.
That's just not enough to rid the industry of rogue traders as far as the
Consumers' Association is concerned. Nick Stace, director of Which? Campaigns,
adds, "Which? is stepping in where the OFT has failed to ensure people get
adequate protection when making the biggest purchasing decision of their
lives".
The Move It campaign is asking for mandatory regulation of estate agents
to replace self-regulation and an immediate review of the Estate Agency Act,
which was last modified 25 years ago. Which? says that the current
self-regulatory system in which agents monitor themselves is just not working.
Move It has already attracted the support from The Royal Institute of Chartered
Surveyors (RICS) and now the Council of Mortgage Lenders (CML), representing
about 98% of lenders, has put its weight behind it. The CML also wants the
Department of Trade & Industry to reject the OFT's recommendations and
introduce mandatory regulation of estate agents.
CML director general Michael Coogan said, "In an environment where everyone
else involved in the transaction will be regulated - the conveyancer, the
surveyor, the broker, the mortgage lender - it is ironic that the estate
agent, who is in many ways the most important player in determining the outcome
of the house sale, is the only professional who does not have to meet stringent,
compulsory standards. This situation cannot be right."
Give it a go yourself
Anyone can set themselves up as an estate agent. To prove the point, Nick
Stace recently registered his own estate agency in London, even though he
is completely untrained. Unlike other industries, there are no minimum standards
of competency for estate agents. This is something both RICS and Which? want
to change with minimum levels of competency introduced. However, right now
this untrained and fairly unregulated bunch manage to earn £4 billion
in fees from the 1.8 million of us who move home each year!
Halifax, which has its own estate agency business, said that estate agents
should be regulated in the same way that mortgages are regulated. It added
that it has been vigorously campaigning for transparency and compulsory
membership of the estate agency ombudsman scheme, which would give us as
homebuyers and sellers redress should we be dissatisfied with a service from
an estate agent.
At the moment, the majority of estate agents do not belong to any kind of
professional body nor do they use a code of practice. Only about one-third
adhere to a code of practice through membership of the National Association
of Estate Agents (NAEA), RICS or the ombudsman scheme for estate agents.
Even the NAEA has said that it was disappointed with the recommendations
by the OFT. It wants to see more agents become members of the NAEA and join
the ombudsman scheme. It is also running a national advertising campaign
encouraging people to use only NAEA-accredited agents.
The ball is now in the government's court whether to introduce mandatory
regulation and reject the OFT's proposals.
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