Regulation & Law
News articles looking at national legislation and local regulation and the application of law to the residential property industry.
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Should there only be one property ombudsman to handle complaints?
That's one of the questions Ombudsman Katrine Sporle will face when she goes live on Wednesday on Rightmove's Webinar platform.
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Estate agents to face mandatory qualifications and referral fee transparency
Government outlines aggressive new measures to put "consumer in the driving seat" says Housing Secretary Sajid Javid.
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London house is first in UK bought via a mortgage deed signed and lodged online
on Rotherhithe in London will soon be famous for more than just its Brunel-built tunnel underneath the Thames. Yesterday, a house there became the UK’s first home purchased via a mortgage deed signed and lodged with the Land Registry online and without the need for a physical or witnessed signature. This begins a process that will see much of conveyancing and the mortgage lending process move from mountains of paper to an online procedure which, agents will be relieved to hear, is set to significantly speed up sales progression. This first transaction was completed by the Land Registry in partnership with Coventry Building Society and conveyancing firm Enact as part of an initial test. It included using the government’s online identity verification system GOV.UK Verify to enable the borrower involved to sign the mortgage deed online without the need for a witness. Pioneering The pioneering transaction is part of the Land Registry’s attempts to transform the conveyancing market by making home buying quicker and simpler. And although a small first step, the Land Registry says the transaction follows months of testing with Coventry Building Society and Enact. “By working with partners in the industry, we have secured a simpler and…
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Letting agents today face new but “pointless” Banning Orders and Rogue Database system
The government’s Banning Orders and Rogue Database system for letting agents has gone live today despite the Association of Residential Letting Agents (ARLA) describing the initiative as “disappointing” and “pointless”. From now onwards, landlords or letting agents who are convicted of specific offences can be banned from letting or managing a property for at least 12 months via a Banning Order, and added to the Rogue Database for at least two years. The offences cover the most serious housing and criminal crimes. These include those involving fire and gas safety, Right to Rent, housing benefit fraud, ignoring council improvement notices, collusion in cannabis cultivation or drug dealing, poor HMO management, illegal evictions and violent or sexual offences against tenants. “I am committed to making sure people who are renting are living in safe and good quality properties. That’s why we’re cracking down on the small minority of landlords that are renting out unsafe and substandard accommodation,” says Minister for Housing and Homelessness Heather Wheeler. “Landlords should be in no doubt that they must provide decent homes or face the consequences.” First Tier Tribunal Once convicted, councils can apply to a First Tier Tribunal to have the landlord or agent involved banned…
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Fifth of all agents fined for AML non-compliance
Nearly a fifth of all estate agents have been fined for non-compliance with the UK’s recently-introduced Anti Money Laundering (AML) regulations, it has been claimed. The research has been carried out by online identity verification service firm Credas, which says it believes agents were not given enough time or information by the government to prepare for AML, with predictable results. It polled 100 agents and found 19% of them had been fined for AML non-compliance by an average £11,842, although a third had been fined much more, at between £15,000 and £25,000. One of the duties estate agents must complete to be compliant with AML regulations is to store all their documentation relating to clients, financial transactions and other Anti Money Laundering paperwork. “We are concerned that 32% of the agents surveyed are still using a paper filing system to store their AML data,” says Credas CEO Rhys David (left). “There are so many digital solutions available on the market which will help agents with data storage and management, that there is no need to still depend on an old-fashioned filing cabinet and introduce risk. “Credas solves both those problems as it stores all the AML data in a secure…
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Compulsory CMP membership for letting agents gets green light
All lettings agents will soon be required by law to sign up to an approved Client Money Protection (CMP) scheme or face a fine of up £30,000, it has been announced. This is the government’s response to its recent consultation on CMP which has run for three months and received 117 responses. The government will now move to make CMP scheme membership mandatory for letting agents, with plans to set up a government-approved but ‘market led’ approach to provision, similar to the existing redress and deposit protection schemes. Many of the consultation’s respondents agreed that these schemes should be approved and offer minimum standards of service including having a stringent claims process in place. The respondents included ARLA, which argued in its consultation submission that a single scheme operated by government would “stifle competition in the market and may ultimately lead to agents paying a much higher CMP levy than they currently are without offering any greater protection for consumers”. Mediterranean cruises ARLA also highlighted the case of Devon letting agent Janine Pickett, who in 2014 was found to have paid for Mediterranean cruises and a £7,000 Welsh pony out of client funds, cash that – because her franchisor was…
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Lettings sector to face huge reforms designed to weed out rogue agents
A new compulsory code of conduct for agents backed by mandatory qualification for at least one member of staff and a new independent regulator have been announced for the lettings and property management sectors by the Ministry of Housing, Communities and Local Government (DHCLG). The details of the new code will now be thrashed out by a working group of lettings, tenant and regulatory representatives, with proposals nailed down by early 2019. The DHCLG announcement, which was released during the Easter break, revealed that it wanted to protect the UK’s nine million private renters from the unexpected costs, vague bills and poor quality repairs offered by rogue agents. “Most property agents take a thorough and professional approach when carrying out their business, but sadly some do not,” says Housing Minister Heather Wheeler (pictured, left). “By introducing new standards for the sector, we will clamp down on the small minority of agents who abuse the system so we can better protect tenants and leaseholders who find themselves at the end of a raw deal. Other measures outlined by the DHCLG include the promised reform of leasehold including a new system to help leaseholders challenge unfair fees, help to switch managing agents…
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MPs recommend to tighten up draft Tenant Fees Bill including five-week deposits
Housing committee ignores industry on damage bill may do to housing affordability and letting agent viability, and recommends smaller deposits, tighter rules on other allowable fees and harsher policing.
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Welsh buyers rush to complete before April 1st Stamp Duty hikes
A predicted rush to sell Welsh properties at the top end of its property market has been taking place in recent weeks as buyers have attempted to beat the April 1st deadline for the principality’s new devolved Stamp Duty regime. The way that the slabs of tax banding are now arranged in Wales mean the duty rises more harshly than in England for those who buy properties over £402,000, although the new system is more generous to those buying under this price threshold than the English system. Although a £402,000 buyer pays only £200 more than their English counterpart, the differences are more stark further up the value chain. For example, a home worth £500,000 in England attracts a Stamp Duty bill of £15,000 while the same purchaser in Wales will pay an LTT charge of £17,500. But a house worth £1.5 million will attract an LTT bill that’s £17,450 higher than a similar English property. Rush to complete Welsh law firm Geldards recently predicted that the changes would lead to a “stampede” in upmarket buyers completing before this Sunday. But removals website CompareMyMove.com, which is based in Wales, says overall the new LTT will benefit most ‘average’ Welsh buyers.…
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Tenancy Deposit drama makes EastEnders episode
EastEnders continued its tradition of tackling social issues head-on when it made a deposit dispute a key storyline. The recent depiction has been praised by the TDS (Tenancy Deposit Scheme), with the organisation saying it has brought to light important issues in the private rental sector. The plot centered on a landlord who returns to Albert Square with money problems. He decides to terminate a tenancy and uses the check out as an opportunity to make some money for himself. Although the property had been left in good condition, the landlord pours coffee over the carpet and blames the tenant, stating he’ll have to keep the deposit to until he knows how much it will cost to rectify the damage. “The vast majority of landlords look after their tenants and abide by the law, but there’s a small minority who don’t and that can be a problem if tenants are unaware of their rights.” While maybe not as thrilling as shady dealings, shootings and secret love children, the deposit storyline has brought into focus a number of issues that many landlords and tenants can relate to. As well as questioning whether the TV landlord had protected the tenant’s deposit, the…
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