Housing Secretary Sajid Javid has announced plans to shake up both the selling and renting of residential premises, plans which are likely to have a huge impact on the sector.
Under the proposals, all estate agents will be required to hold a professional qualification, with Government research claiming a minority of the 20,000 estate agent businesses across the country cause significant problems. Currently, anyone can practice as an estate agent.
Managing agents will also be forced to reveal the fees they receive for referrals to solicitors, surveyors, and mortgage brokers.
Estate and Letting Agents Changes
In an effort to tackle the practice of “gazumping”, the Government is also proposing to encourage buyers and sellers to sign “lock-in agreements”, under which either party would face paying a financial penalty if they backed out of a deal without justification. The Government claims delayed decisions account for 250,000 house sales falling through annually.
The Government has also announced further measures, including:
- A requirement for estate agents and freeholders to provide up-to-date lease information for a set fee and to an agreed timetable;
- Strengthening Trading Standards so it can carry out more enforcement activity, including banning agents; and
- Producing “how-to” guides for buyers and sellers
The NAEA has welcomed the commitment to further regulation and Russell Quirk, chief executive of online estate agency Emoov, also commented: “This is really great news. The industry and Government have talked to a long time to clean up house buying. If you add both speed and certainty to the process, there will be fewer transactions falling through, less wasted money, and less stress for the consumer.”
He added: “For far too long it has got away with being almost entirely unregulated. How can it be that financial advisers dealing with the loan for the property are vetted, but the people dealing with the asset itself and the trauma of a protracted process are not overseen or licensed?”
If you are a property professional looking for legal advice or support please do not hesitate to contact Lisa Caporaso on 01206 239760 or a no-obligation consultation.