William Eichler 02 June 2017

Enforcement regime on displaying agent fees ‘failing’, survey reveals

The enforcement regime on displaying agent fees is ‘failing’, says licensing group as survey reveals the majority of councils are not issuing penalties for non-compliance.

In 2015, it was made law for agents to display their fees. However, a survey of 42 local authorities by the National Approved Letting Scheme (NALS) found 93% had failed to issue a single financial penalty to letting agents for non-compliance.

The survey, based on Freedom of Information requests, revealed only three penalty notices have been served for failure to display all relevant landlord and tenant fees, and of these, only one has been paid in full.

NALS concluded the the lack of notices served by councils raises ‘clear concerns’ that the level of penalty may not be right to cover the cost of enforcement. Currently, the maximum penalty is £5,000.

The Government has said the private rented sector is a high priority. However, this does not appear to be the case for councils where most (59%) admitted they do not consider the display of letting agent fees represents a high priority for the allocation of resources within Trading Standards.

Almost half of local authorities (45%) said they only undertake reactive enforcement activity. A third (33%) allocated no staffing resources to this work in 2016/17, while 62% of councils anticipate no changes in the level of staffing resources in 2017/18.

Nearly two thirds of local authorities (64%) also revealed they haven’t yet assessed the likely impact on enforcement when the Government introduces a ban on letting fees to tenants.

‘We’re clearly concerned by these results and the disconnect between Government’s aspirations with consumer protection legislation and the reality of delivery through enforcement,’ said Isobel Thomson, chief executive of NALS.

‘We recognise trading standards teams are underfunded and under-resourced, but if local authorities aren’t enforcing the current legislation what will make things different when the fee ban is implemented?

‘Without sufficient robust and coherent enforcement action, we will never stop the criminal element in the PRS. They will continue to operate knowing they won’t face any penalty and it’s the consumer who will continue to suffer.

‘We believe now is the time to start a constructive dialogue with the Chartered Trading Standards Institute and its members on how we can work together to stamp out the rogues.’

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