The Regulation of Property Agents working group has proposed a range of regulatory changes for estate agents in the UK
All property agents should be overseen by a single regulator, with estate agents required to follow a code of practice, gain qualifications and obtain a licence, according to proposals made by the Regulation of Property Agents working group.
The group was set up by the Ministry of Housing, Communities and Local Government last year, and has today published its final report.
The working group is chaired by Lord Best, and made up of representatives including the Royal Institution of Chartered Surveyors, NAEA Propertymark, National Trading Standards, the National Landlords Association and Citizens Advice.
It outlined a host of recommendations over how best to proceed with overseeing property agents.
For example it recommended that while all agents ‒ including auctioneers and rent-to-rent firms ‒ should be overseen by a new regulator, property portals and short-term letting firms like Airbnb do not need to be covered, albeit with the proviso that the legislation should allow the regulator to extend its remit.
It called for all qualifying agents to hold and display a licence to practice from the new regulator, with the requirement of passing a fit-and-proper person test and fulfilling certain obligations, such as signing up to a redress scheme, before the licence is granted.
An ‘overarching’ code of practice must be set up which all agents will be required to follow, with key principles including that all agents must act with honesty and integrity, as well as being appropriately qualified.
In terms of qualifications, the report argues that licensed agents should be qualified to a minimum of level three of Ofqual’s Regulated Qualification Framework, while directors and managing agents should be qualified to a minimum of level four.
The report makes clear that it does not believe any existing body can take on the role of regulator, meaning a new one should be established. This regulator should be funded by the firms and individuals it is overseeing, though the government should provide ‘seed corn’ funding to help with its creation and initial operating costs.
It also suggests that the regulator should be able to determine whether some professional bodies could deliver certain regulatory functions. It is now up to the government to decide which, if any, of the proposals it wants to proceed with.