Former housing minister Mark Prisk has said that buy-to-let is “distorting” the housing market and that the “direction of travel” must be changed.
He also sharply criticised some letting agents for showing the industry “in the worst possible light”.
Prisk, a qualified surveyor, was speaking at the RICS residential conference.
He said: “There also remains a problem with some letting agents. Again, the majority do the right thing and I applaud the work of the RICS and others in helping set and maintain good practice.
“Yet (as recent high-profile cases show) there are still agents whose actions show the sector in the worst possible light.
“The result is the public all too often have a negative view of the whole sector, and landlords and letting agents come pretty low in public esteem.
“So I believe the sector needs to change and be seen to change. Strong leadership will be needed to drive it through.
“Indeed, if nearly 20% of households rent their home, we all have a duty – professionals and politicians alike – to make sure the sector offers what people want and need.”
Prisk said that landlords and agents need to start talking about “customers” and not “tenants”.
He called for clear and transparent pricing, and clarity about future rents.
On property investors, he said: “I have nothing against individual buy-to-let landlords. With record low interest rates, prudent savers have naturally switched to property to get a better return.
“However the scale of buy-to-let is distorting housing markets, for example, for first time buyer.
“I believe now is the time for government to review the regulatory and fiscal treatment of buy-to-let to tip the balance in favour of those seeking long-term returns, not short-term capital gains.
“Clearly any changes would have to be undertaken with the greatest of care and over a phased period, but I think that the direction of travel needs changing, and towards long-term investment, for those seeking revenue.”
He went on: “I believe that the private rented sector has a great future, with strong demand and a clear, long-term policy framework to attract investment.
“However, the sector’s poor reputation amongst the public means that increasing supply alone won’t be enough.
“Professionals and policy makers need to redefine the sector, in terms of the service offered; in terms of having transparent pricing; and in the language and standards set.
“Some of the changes won’t be popular amongst existing landlords. Some letting agents will regard this as political froth and needless red tape.
“But if this sector is to fulfil its true potential, landlords and their professionals will need to accept that business as usual simply isn’t an option.”
Comments (11)
Yet again someone trying to make a buck out of Estate Agents. Regulate and penalise the majority to hurt the minority.
All that happens is the good agents take it on the chin and the bad ones find a way around it.
If you scr#w people your reputation will diminish until you put yourself out of business and good riddance.
Not rocket science.
” I have been calling my customers, customers for ages, i use it often to my clients…”
Erm… isn’t that a clear ‘make your mind up’ kinda quote?
Putting aside buy-to-let specifically, there needs to be a major overhaul of “professional status” and “discipline” in the world of estate agency.
A “licensing system” is long overdue as is the case in the USA, many European countries – including France – and in Australia. Proper professional training and examination – including in ethics – followed by a formal government license with regular CPD.
Its not rocket science and doesn’t require a long drawn out course. But it does need to be professional and regulated.
Standards would greatly improve as would the reputation of estate agency which provides a key service to both the public and the economy.
Pre NFoPP that is exactly what we had! NAEA Estate Agents doing a good job of selling property professionally and well, ARLA letting and property management Agents doing an exemplary job of lettings and general practice RICS doing a bit of both, well.
I see this “Licensing system” referred to time and again but i cant help thinking its a myth.
What rules do you propose they enforce? – I mean we do a pretty good job of self ruling as it is, yes some rogues but only a small minority.
How is this going to be paid for? – Are you expecting the government to pile in millions and make a mess of it or do you think estate agents need more out goings another £1000 per branch a year on top of more expensive insurance premiums?
More exams to allow the governing body to increase coffers? – 20 years ago to be a financial adviser you needed to pass three pretty hard exams to advise on subjects today its three papers in pretty much every financial product. Many advisers have taken early retirement and sold their client banks as they do not want to keep taking exams year after year. We now have a lack of quality advisers!
Regulation sounds great but it will not fix everything, in my opinion will make things worse.
Even perceived well run regulated industries, law, surveying, financial services all have their problems ……
The US system, openly agrees it is rife with corruption and malpractice which is a mind set they haven’t been able to root out with licensing.
The comments are a step in the right direction. We have to start somewhere. I have been calling my customers, customers for ages, i use it often to my clients so that they understand that they are now running a business. Attitudes need to change and so much more.
Sorry Jacqui but this is snidely schoolboy stuff, the bit where the bigger boys who caused all the problems now skilfully pass the buck and leave someone else to cop the blame. It’s a good job the LAT archive has been kept safe, it contains a documented history of underachievement by several ex- ministers and their failure to even acknowledge the advice they are now claiming as their own.
“He said: “There also remains a problem with some letting agents. Again, the majority do the right thing and I applaud the work of the RICS and others in helping set and maintain good practice”
Prisk applauds the work of the RICS setting and maintaining good practice, excuse me?
I challenge anyone to find a single sentence or single second of VT where RICS has been seen to do that since the publication of Practice Notes for Estate Agents in 1984. (isbn no 0 854062335)
It is with regret I would claim that RICS have been a hurdle to progress in the sector rather than a stile to assist it. As for the various Housing and CLG ministers, I simply can not recall one prepared to listen to good sense or experience.
@Robert May – Prisk applauds the work of the RICS setting and maintaining good practice, excuse me? I challenge anyone to find a single sentence or single second of VT where RICS has been seen to do that since the publication of Practice Notes for Estate Agents in 1984.
RICS gathered together 17 bodies including ARLA, NALS, RLA, the three redress schemes and Ombudsmen to create the PRS Code of Practice, a cross-industry initiative. Also, worked with DCLG on the “How to Rent” guide with DCLG, which advises tenants to look for regulated agents. Also produced guidance for letting agents on complying with CPRs. Also RICS Blue Book for all residential agency/management work. Also provides world-class regulatory regime of its members. Also provides the most comprehensive Client Money Protection scheme for clients and customers. Also regular appearances in national and local media calling for better/proportionate/enforced regulation of the PRS.
Challenge noted and met, thank you Robert. But the PRS still has a poor reputation and there’s a lot still to do.
Andrew Bulmer – RICS UK Residential Director
Thank you Andrew, how exactly does the Blue Book or your letting guide improve on Practice notes for Estate Agents written 20+ years before?