We can all see that agency, whether sales or lettings, is a focus for all political parties these days.
The current government has brought into force quite a number of new obligations over the past year or so and it doesn’t appear to be over just yet.
The impact of legislation is linked to enforcement: no enforcement – little impact; strong enforcement – big impact.
Anti-money laundering obligations are a classic example of this.
Estate agents were initially regulated way back in 2003, but not one agent took any notice of the obligations for many years, because there was no enforcement.
Move forward to 2015 when HMRC started to seriously enforce AML, issuing large penalties against the corporates (and others) and you started to see agents sitting up and taking note.
Many agents started to get things in order. If I look now, compliance might not be anywhere near to 100% across the sector, but the savvy agents are taking it seriously, because the penalties can hit the bottom line.
Unfortunately, enforcement by other authorities such as Trading Standards has been sadly lacking due to funding issues and that is unlikely to change in the short term, except in one area and that is where fixed penalties apply.
Did you know that Trading Standards can issue fixed penalties of £200 for every property advertised on your website that doesn’t indicate an energy rating?
A number of London borough Trading Standards departments have been very proactive in the fixed penalty area, issuing thousands of pounds worth of penalties against letting agents for breaching the Consumer Rights Act.
The most notable one was a total penalty of over £10,000 issued against a letting agent by Camden Council, in a case that subsequently went to the First-Tier Tribunal.
http://www.bailii.org/uk/cases/UKFTT/GRC/2018/PR_2018_0002.html
Recently, as reported in EYE, Trading Standards in another London borough, Brent, conducted a survey of agents’ websites to assess compliance with the information display obligations and it found only 20% were compliant.
This means that over 50 agents in the borough have a risk of fixed penalties being issued as a result of compliance failures that are so easily rectified.
There is a whole spectrum of obligations that as an agent you must meet on your website, including –
- Consumer Rights Act
- Tenants Fees Act
- Companies Act
- E-commerce Regulations
- General Data Protection Regulation
- Energy Performance of Buildings Regulations
Your website is a useful marketing tool – but it is also, potentially, a legal minefield which could get you into trouble. Your website is your first line of defence, so make sure it is compliant. Or it could prove expensive.
* A free compliance helpline is run by David Beaumont, of Compliance Matters, and is exclusively available for EYE subscribers, on 0161 727 0798.
Comments (4)
“Estate agents were initially regulated way back in 2003, but not one agent took any notice of the obligations for many years, because there was no enforcement.”
And the same applies to reviews today.
Well said David Beaumont.
There are three issues at play here.
Firstly is agents’ awareness of the minutia of regulation they have to comply with. When it became compulsory to display tenants fees some years ago a surprisingly high percentage of our clients were not aware of it at the time it came into force.
Second is agents’ willingness to comply. 6 months after having told all our clients about the change only 5% had asked to have their fees added to their site. It was even worse when landlord fees had to be displayed with many agents initially actually refusing to do it because they felt it weakened their negotiating position and didn’t want to be first to do it in their market.
Third is ignorance of web developers. We often see agents hiring their friend/relative/local computer guy to punch out a WordPress site for them because it feels quick, cheap and local. This often proves to be a false economy because they are unaware of the legal minefield they are wandering through and end up incurring fines which cost considerably more than a professionally built site done by industry experts.
HM Government will always generate revenue wrapped up as enforcement of consumer standards, so don’t make it easy for them. Compliance is free and easy, and an industry expert will save thousands of pounds in the long run.
‘Estate agents were initially regulated way back in 2003, but not one agent took any notice of the obligations for many years, because there was no enforcement.’ Rubbish, most of us have been doing it since day one.
Doesn’t help that alot of expert agent customers are being told there sites can’t be made compliant and they need a new web site.
A complete untruth .
Have you checked your maps recently ? They don’t work either.
Maps
Cookies
Https warning in url . Affects your seo ranking.