The provision of redress schemes within the industry looks to be in trouble after one of the three government-approved ombudsman services announced today that it would be pulling out of the property sector.
This means that the estate, letting and managing agents currently signed up to Ombudsman Services now have until August 6th to find a new provider.
Ombudsman Services, which is based in Warrington and offers complaint handling services across several other sectors including removals, media, communications, energy and copyright, says it no longer wants to offer a “broken solution to a broken market”.
But the organisation, rather than exiting the sector entirely, says it is to develop a “new model” for redress in housing.
The move appears to be a pre-emptive strike to distance itself from the existing complaints handling structure that operates within the property sector, and to position itself as the next ‘housing ombudsman’ that the Ministry for Housing, Communities and Local Government (MHCLG) is preparing to establish this Spring.
Ombudsman Services says the property industry should copy the finance and energy sectors and feature a single regulator backed by one ombudsman. It is now to quiz consumers on what they want from an ombudsman service before launching its new model.
“Redress in the housing sector is a really confusing picture for all involved. The patchwork of Alternative Dispute Resolution and ombudsman schemes is a mystery to consumers and therefore is incredibly difficult for them to navigate,” says Chief Ombudsman Lewis Shand Smith (pictured, left).
“We are ceasing what we’re currently doing in the housing sector in a professional and planned way, because we believe it is not adding value.
“Rather than continue to offer a broken solution to a broken market, we are stepping away to listen to what consumers actually want.
“We fully support Sajid Javid regarding the need for a single ombudsman for housing – only then will the sector be able to restore trust and ensure that consumers get a much better standard of service.”
The National Approved Letting Scheme (NALS), which has many members signed up to Ombudsman Services, says it will help its agent members transfer to one of the two remaining schemes – The Property Ombudsman and Property Redress Scheme.
“In light of the Government’s announcement to consult on a single housing ombudsman providing ease of access for property related consumer complaints, NALS understands the decision Ombudsman Services has taken to withdraw from the current redress set up and look to the future,” says Isobel Thomson the CEO of NALS (pictured, right).