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Mandatory Letting Agent Redress Schemes Now In Effect


Tuesday, October 7, 2014

Mandatory Letting Agent Redress Schemes Now In Effect

Mandatory Letting Agent Redress Schemes Now In Effect

Deadline For Mandatory Redress Scheme Membership Has Passed

As of the 1st October 2014 Government legislation changed meaning that all UK lettings and property management agents must belong to one of the three Government approved property redress schemes.

These are:

  • The Property Ombudsman
  • Ombudsman Services Property
  • The Property Redress Scheme

Each of the mandatory redress schemes offers an independent and impartial complaints investigation process and each has the ability to award compensation to tenants if a complaint against the landlord’s appointed letting agent is upheld.

Before October 1st , membership of a redress scheme was voluntary, however it was estimated that up to 40% of the property lettings industry was not registered to any scheme, prompting the government to take action and make it mandatory. The Government’s intention is to promote fair treatment and transparency between landlords, letting agents and tenants and to ensure that, in the event of a complaint, there is a defined and independent process to resolve those complaints.

The background legislation for the mandatory property redress scheme is the Enterprise and Regulatory Reform Act 2013 and the details of the regulations can be found here – The Redress Schemes for Lettings Agency Work and Property Management Work (Requirement to Belong to a Scheme etc) (England) Order 2014

In summary, the most important point for UK landlords and lettings agents to note is the sanction for non-compliance which is that anyone engaged in property letting and management who has not joined a mandatory redress scheme may be liable to a fine of up to £5000 (GBP).

Enforcement will be carried out by the Trading Standards department of every local authority in the country, these local authority departments have been facing significant cuts in funding, raising the question as to whether there will be sufficient resources to enforce the new mandatory Government regulations effectively but the message to all landlords and letting agents is clear; membership of a redress scheme is now mandatory so any portfolio landlord or letting agent who has not already registered, should sign up immediately.

Mike Clarke from Manchester based Geo Property Lettings said: “All UK lettings and property management agents have a duty of care to protect the interests of the landlord clients, and their tenants. We operate within the legal framework outlined by current housing and consumer regulations and mandatory registration of a property redress scheme is an important step in reducing the number of rogue landlords and dodgy practices conducted by unscrupulous letting agents”.

Sim Sekhon from the UK’s leading supplier of specialist products and services to the lettings industry, Legal 4 Landlords, said: “Mandatory membership of one of the three Government schemes is good news for the UK lettings industry, this will promote best practice throughout the UK rental property market, raising the overall standards of property rental in the UK”.


This was written by Mike Clarke. Posted on at 11:30 am. Filed under Landlord News. Tagged , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , . Bookmark the permalink. Follow comments here with the RSS feed. Both comments and trackbacks are currently closed.