A guidance to selecting a reputable letting or managing agent in England

Published: 20 June 2024

Often, we hear of tenants and landlords being left stranded due to the actions of rogue letting agents. Ultimately, the landlord is responsible for letting their property and will end up losing thousands of pounds in the eviction process, as well as losing out on many months of rental income that was left with the agent. Tenants are often losing out on months of deposits and advanced rents paid to secure the property.

Below are a few helpful tips on how to select a letting agent that is backed by a client money protection scheme.

What laws apply to letting agents in England?

In England, you do not have to be qualified to work as a letting agent and anyone can set up a letting agency without any prior experience.

Sadly, there is currently no overarching statutory regulation of private sector letting or managing agents. However, they are still subject to consumer protection law and a couple of industry-specific provisions.

Letting agencies must become members of a government-approved trade association as a formal commitment to best practices and to join a network of industry expertise. Such trade associations require their members to adhere to additional regulations to ensure that they are delivering exemplary service.

Overview of the key industry-specific regulations

The key regulations apply to letting agencies in England. Letting and managing agents must:

  1. Register with a Government-approved independent redress scheme.

Letting agents engaging in letting agency or property management work relating to private accommodation must be a member of a redress scheme for dealing with complaints in connection with that work. This ensures both landlords and tenants can make complaints to an independent, expert body. By law, a statement that they are a member of a redress scheme, and the name of the redress scheme must be displayed at each premises of the letting agent or property manager or published on their website. The two approved schemes are the Property Ombudsman (TPOS) and the Property Redress Scheme (PRS). A local authority can issue a financial penalty of up to £5,000 for letting agents not members of one of these schemes. You can use the National Trading Standards property checker to both find registered agents and check whether an agent is registered.

  1. Register with a Government-approved Client Money Protection (CMP) scheme.

CMP schemes safeguard any money held by a property agent on behalf of the landlord, tenant, or other client. If the funds are misappropriated or lost, the CMP scheme compensates the client. Agents must provide the name of the approved scheme and display their certificate of membership in their offices and on their website.  Failure to join a CMP scheme could result in a financial penalty of up to £30,000 and a further financial penalty of £5,000 for not displaying their certificate as transparency requirements. The six approved or designated schemes are Client Money Protect, Money Shield, Propertymark, RICS, Safeagent and UKALA.

  1. Fully comply with the ban on letting fees in the Tenants Fees Act 2019.

The Tenant Fees Act 2019 abolished most upfront fees for tenants in England. Unless a fee is ‘permitted’, it will not be lawful. In addition, under the Consumer Rights Act 2015, agents must display a list of relevant fees in a prominent position within any premises where potential clients are dealt with face-to-face and on their website. Not displaying fees can incur a financial penalty of £5,000.

What steps can I take to find a reputable agent?

  • Check if the agent is a member of a professional body. It is worth noting that Propertymark is the leading membership body for property agents.
  • Check if the agent is a member of a redress scheme and a client money protection scheme.
  • Check whether the agent has complied with the ban on letting fees in the Tenant Fees Act 2019 by taking a quick look at their fees.
  • Have a written agreement outlining the services your agent will provide and when.

How do I report a breach?

Trading Standards are committed to clamping down on dodgy letting agents. Should you encounter a letting agency in breach of any of the above requirements operating in the borough, please report the agency to your local Trading Standards Team by checking against your postcode: https://www.tradingstandards.uk/consumer-help/

Please note:

This information is intended for guidance; only the courts can give an authoritative interpretation of the law.