Lettings agents in England and Wales have been required to join a redress scheme since October 2014. However, the Ministry of Housing, Communities & Local Government has updated guidance for lettings agents to remove Ombudsman Services: Property, from the list of approved redress schemes.
The government with the mutual agreement of the Ombudsman Services: Property, will withdraw their services from the list of approved redress schemes for lettings agents from 6 August 2018. The remaining redress schemes are:
The requirement to join a scheme applies to letting and managing agents where the tenancy is an assured shorthold tenancy under the Housing Act 1988. The intention is that all high street and web-based lettings agents (who provide more than a mere introduction service) will be subject to this requirement to belong to a scheme.
In order to join a scheme, lettings agents complete an online application form and pay the requisite fee. Where agents have failed to join a scheme, they may face a fine of up to £5,000. Prior to imposing the fine local authorities will permit agents to put any objections to the fine in writing within 28 days. The local authority will take the representations into consideration prior to making a final decision on whether to impose the fine or not. An agent that is fined has a right of appeal to the First Tier Tribunal.
Lettings agents that have been members of Ombudsman Services: Property should have been contacted about this development. If agents who are members of the Ombudsman Services: Property are unsure about what to do now they should contact Ombudsman Services: Property and seek information. We understand that all members of Ombudsman Services: Property will need to apply to one of the two alternative schemes and any agent that has not done this should consider doing so urgently.