Agents back more regulation to remove rogue firms

The majority of estate agents back Government regulation as almost half report rogue operators in their local market, research suggests.

New market insight from GetAgent.co.uk has revealed that 92% of estate agents across England and Wales support plans introduce stronger regulation of the industry.

The research found that most half, at 48%, reported that they believe rogue or substandard agencies are an issue within their local market.

The research, commissioned by GetAgent, surveyed 537 estate agents across England and Wales to assess the prevalence of rogue operators, the damage caused by poor industry practices and whether the Government’s proposed introduction of independent regulation, mandatory licensing and professional qualifications could help improve standards.

When asked what agents believe most commonly makes an agency rogue or substandard, poor knowledge of property law and regulation ranked top at 21%. Aggressive or unethical sales practices and misleading marketing or withholding important information followed at 16% each, while hidden fees or unclear charges and inexperienced or poorly trained staff both accounted for 15%.

The biggest concern among agents is the wider reputational damage caused by such practices.

Reputable agents already hold themselves to high professional standards, and stronger regulation should ensure those standards are upheld consistently across the industry.”

Almost a third – at 31% – identified damage to trust in estate agents as the most significant impact of rogue operators, while 16% highlighted the competitive disadvantage faced by reputable agencies.

Agents also pointed to the consequences for sellers, including longer or more difficult sales processes – at 14% -, unnecessary or unclear fees – at 14%, a greater risk of sales falling through – at 13% – and lower sale prices being achieved at 9%.

Against this backdrop, 92% of agents believe stronger regulation, including mandatory licensing and professional qualification requirements is needed. Just 7% believe existing regulation is sufficient, while 2% believe the industry is already over-regulated.

When it comes to the measures most likely to improve standards, a legally enforceable code of conduct and minimum professional qualifications ranked joint top at 16% each.

Mandatory licensing and stronger enforcement and financial penalties also ranked highly.

However, agents also recognise the potential challenges of introducing a more comprehensive regulatory framework.

Increased costs for agencies ranked as the biggest potential downside at 23%, closely followed by concerns that regulation could become a box-ticking exercise at 22%. A further 15% highlighted the additional administrative burden, while the same proportion expressed concern that smaller agencies could struggle to comply.

However, one in five agents believe mandatory licensing and professional qualifications would bring no significant downside.

Professional standards

Colby Short (pictured), Chief Executive of GetAgent, says: “Good estate agents work hard to build trust with sellers, provide sound advice and deliver the best possible result. Unfortunately, it only takes a relatively small number of operators falling short of those standards to damage confidence in the wider profession, and that’s clearly a frustration being felt by agents across the industry.

“It’s encouraging to see such strong support for greater regulation, particularly when agents themselves recognise the potential costs and administrative challenges involved. Reputable agents already hold themselves to high professional standards, and stronger regulation should ensure those standards are upheld consistently across the industry.

“Of course, regulation needs to deliver more than additional paperwork. The real value will come from tackling poor practices, protecting consumer confidence and creating a fairer environment where quality agents can compete on the strength of their service and results.”