Letting agents blamed for rise in ‘bidding wars’ as ban proposed
Campaigner Tom Darling has blamed letting agents for prompting competitive bidding for properties, which he says is a 'disgraceful practice'.
A leading private rented sector campaigner has called on Labour to make it illegal for letting agents to take or encourage competitive bidding for rental properties.
Tom Darling, who is campaign manager for the Renter’s Reform Coalition, has said on Twitter/X that while he supports Labour’s proposal to stop landlords encouraging tenants to bid competitively for homes, he believes the main ‘culprits’ are letting agents.
Writing on the social media platform, Darling says: “I think this specific issue on bidding wars is mainly the fault of agents and in order to work [Labour’s proposal] will need to cover them. “Having experienced myself in London the way they pit desperate renters against one another is truly disgraceful”,
What campaigners, and Labour, have not revealed is how such a major intervention in a free market would look like and how it would be policed.
Despite both Labour and Conservative housing minister in the past having promised to stamp out comparable practices in the sales market such as gazumping and gazundering, no legislation was forthcoming when they realised policing price negotiations on a macro level would be impossible or too expensive.
Regulation
Several Twitter/X users have disagreed including social housing expert Harry McKeown, who said greater training and regulation of letting agents would help prevent bidding wars.
“Create an independent public body, with oversight of enforcement, redress and deposit protection schemes,” he said. “Include minimum training and education standards (as has been proposed in the social housing sector) – funded by regulated firms.”
Labour, which is likely to be running the Department of Levelling Up, Housing and Communities after July, has so far only mentioned vague proposals to stop bidding wars.
The most recent research into the practice by the New Economics Foundation among some 1,000 renters revealed 40% of households renting privately who had moved within the last year were paying an average £1,200 a year above the advertised rate for their property.
Mr Darling London is not the centre of the Lettings Universe so feel free to come and join us in East Lancashire and see for yourself how professional LA deal with this so called problem !
Mr McKeown I’m sorry it’s not the lack of training in LA that’s the problem it’s simply supply and demand ! I wouldn’t disagree that on going training should be encouraged but surely hat’s the same in all companies
So, we’ll end up with Dutch auctions (descending price auctions) commencing with much higher prices and reducing until someone bids. Or a rental sector with no new landlords. Or set rental prices that start high and stay high. Build more rental property and rents will come down. Stifle demand, and rents will come down. Campaign all you want but at the end of the day, landlords are not the problem. Having not enough landlords is the problem.
Are we planning to ban all auctions including antiques? It’s simply supply and demand.