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The Property Ombudsman – changes

The Property Ombudsman amended its code of conduct effective from 1 October 2016. There are a number of small changes which will not affect most agents but there are two which are far more serious, one of them very. For agents that are members of the Property Ombudsman scheme this rule change may pose a problem.

The less surprising change is to the requirements around commission fees. This has always stated that agents should tell the landlord where a tenant has used a service for which the agent might earn a commission. The addition is that the amount of the fee earned must be declared. This should not affect too many agents as many already declare these fees and they could provide a little more detail in accounts returns. To be clear, this applies to third party services used by tenants (eg. utilities, broadband, cable TV etc) where the agent obtains a commission.

More surprisingly there is a change to the requirements around tenant inspection of properties. This states that tenants must always give consent for a property inspection and agents cannot rely on assumed consent or telling the tenant that if they do not hear from them they will carry out the inspection using their own keys. This also means that as evidence is expected a telephone call will probably not do.

This will cause substantial problems for agents who are members of the Ombudsman scheme, especially in cases where the tenant has apparently left but the agent is unsure. It is common in these cases to carry out an inspection in order to see whether the tenant is still there. Naturally, direct consent cannot be obtained in these cases and the new code will make this impossible.

Practical options
It is impossible to understand why the Property Ombudsman decided to include this rule or how they expect it to work. If a member of the scheme reading this blog is just as puzzled as we are, perhaps a call to the scheme could clarify matters? We would welcome the feedback and will certainly update this post if we obtain any clarification. In the meantime, the practical advice is that agents keep evidence of their attempts to contact the tenant prior to entering the property. The requirement to always obtain the tenant’s consent is in some circumstances going to be difficult to meet so agents may need to decide whether or not they are willing to take this risk.

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