Just HALF of letting agents think rental sector ‘fit for purpose’

An increasing number of letting agents belonging to the Property Redress Scheme believe the sector is no longer fit for purpose with only over half believing that it’s working – down from 76% last year.

The findings are revealed in the Scheme’s annual report for 2023 which also shows half of all cases (50%) are being resolved through early resolution despite 20% rise in complaints and 95% increase in amount awarded for decisions.

Letting

Overall 58 agencies were expelled in the last 12 months compared to 61 in 2022 with the top three complaints by tenants and landlords were holding deposits, poor service and management, tenancy payments and rent collection.

On ‘Fitness for Purpose’ just 43.3% of landlords and 52.2% of letting agents feel the sector is ‘fit for purpose’ due to more regulation, poorer tax breaks, increased mortgage costs, upgrade costs and the removal of Section 24.

This was a significant drop on last year when three quarters of agents (76%) and landlords (72%) felt it was fit for purpose due to regular income and protective regulations.

Despite the drop in confidence the annual report on complaints received against their property agent members by the Property Redress Scheme also revealed membership numbers grew 7% to 17,459 agents including 1,397 registered branches throughout the UK.

COMPLAINTS

The average rate of complaints for each member reduced to just over 8%, down from over 10% in 2022 and were completed in around 40 days from the time the PRS received them.

Early resolutions awarded a total of £359,426 in 2023, which is a small increase on 2022 (£353,053). The PRS issued 24% more decisions in 2023 than in 2022 with the total figure awarded for decisions was £953,062.24 – an increase of 95% from 2022 (£489,916).

The average award was £1,832.81 and the total figure awarded for early resolution and decisions combined was £1,312,488.

Sean Hooker, Head of Redress at the Property Redress Scheme, says: “The notable increase in financial awards underlines the growing volume of complaints, compounded by a lack of engagement from a minority of members.

“Despite this, it’s encouraging to observe a reduction in complaints per member, indicative of improved efficiency in our investigative processes. Our steadfast commitment to early resolution has proven effective, reflecting a shared willingness among parties to reach amicable solutions.”

And he adds: “We strive to support, educate, and improve industry standards while continuing to clamp down on some of the poor practices that ensue, our adoption of innovative approaches like mediation and early resolution has yielded positive outcomes, fostering greater satisfaction among stakeholders.”