Regulation of Property Agents Working Group - Question

– in the House of Lords at 3:17 pm on 20 October 2021.

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Photo of Baroness Hayter of Kentish Town Baroness Hayter of Kentish Town Chair, International Agreements Committee 3:17, 20 October 2021

To ask Her Majesty’s Government what plans they have to implement the recommendations of the final report of the Regulation of Property Agents Working Group, published on 18 July 2019.

Photo of Lord Greenhalgh Lord Greenhalgh The Minister of State, Home Department, Minister of State (Department for Levelling Up, Housing and Communities)

My Lords, I declare my residential commercial property interests as set out in the register. The Government are committed to promoting fairness and transparency for home owners and renters and making sure that consumers are protected from abuse and poor service. This commitment includes raising professionalism and standards among property agents. The Government are considering the recommendations from the independent working group of the noble Lord, Lord Best, on property agents and we welcome the work by the noble Baroness and the industry itself to improve best practice across the sector.

Photo of Baroness Hayter of Kentish Town Baroness Hayter of Kentish Town Chair, International Agreements Committee

I thank the Minister for that. As he suggests, we now have cross-industry and consumer agreement on codes of practice for all residential agents covering letting sale and block management. The whole industry and its users want to see the report by the noble Lord, Lord Best, implemented and the regulator set up. Therefore, in addition to the words of comfort that the Minister has given us, can he go one further and give us a commitment to implement that report for the sake of all people who rent their houses?

Photo of Lord Greenhalgh Lord Greenhalgh The Minister of State, Home Department, Minister of State (Department for Levelling Up, Housing and Communities)

My Lords, I am not able to go any further but I know that the final code is ready, and that is a springboard to action. I am looking forward to engaging with the noble Baroness in due course.

Photo of Lord Flight Lord Flight Conservative

I congratulate the noble Lord, Lord Best, and his working group on a most thorough report. In its 56 pages, it makes recommendations on a model for an independent property agent regulator, for a single mandatory and legally enforceable code of practice for property agents, and on clarifying processes and charges for leaseholders. Do the Government have any material criticisms of the report to date?

Photo of Lord Greenhalgh Lord Greenhalgh The Minister of State, Home Department, Minister of State (Department for Levelling Up, Housing and Communities)

My noble friend should note that the Government welcome the final report of the independent Regulation of Property Agents Working Group, chaired by the noble Lord, Lord Best. The Government have been clear about the need to raise professionalism and standards among property agents, which is why we tasked a group of experts from across industry, led by our highly experienced chair, to advise on the best way to secure this objective. The working group’s report and recommendations are an important development towards ensuring that all consumers are treated fairly and all agents work to the same high standards.

Photo of Lord Best Lord Best Crossbench

My Lords, as noble Lords have mentioned, I chaired the Government’s working group on regulation of property agents. I am very grateful to the noble Baroness, Lady Hayter, for her sterling ongoing work on this issue. Bearing in mind that the leading industry bodies for estate, lettings and managing agents were all on our working group, as well as consumer experts; our recommendations for a regulator of property agents were unanimous and favourably received by Ministers; the cost of a regulator would fall on the industry rather than on the Government; and I delivered our report over two years ago, may I press the Minister to confirm that there will at least be news of the necessary legislation within six months?

Photo of Lord Greenhalgh Lord Greenhalgh The Minister of State, Home Department, Minister of State (Department for Levelling Up, Housing and Communities)

I take this opportunity to pay tribute to the work undertaken by the noble Lord on the wide-ranging recommendations contained in the final report from his working group. I am grateful to him and to all those who contributed. However, he will appreciate that this is a complex area with many interdependencies. Having paused work on it at the height of the Covid-19 pandemic, we continue to consider the recommendations in the noble Lord’s report.

Photo of Lord Palmer of Childs Hill Lord Palmer of Childs Hill Deputy Chairman of Committees, Deputy Speaker (Lords)

My Lords, I declare my interest as chair of the advisory board of the Property Redress Scheme. The noble Lord, Lord Best, put it very clearly: this report was two years ago, and still nothing concrete has happened. Some things can be done quite simply. The first recommendation is the appointment of a new independent regulator to lead matters in this instance. May I specifically ask the Minister when he expects such a regulator to be appointed?

Photo of Lord Greenhalgh Lord Greenhalgh The Minister of State, Home Department, Minister of State (Department for Levelling Up, Housing and Communities)

The noble Lord will know that the creation of a new regulatory regime requires a legislative underpinning. We are considering how to move forward on this and other areas and will come back to this House in due course.

Photo of Baroness Blake of Leeds Baroness Blake of Leeds Opposition Whip (Lords), Shadow Spokesperson (Housing), Shadow Spokesperson (Communities and Local Government)

My Lords, I pay tribute to the work of my noble friend Lady Hayter, all the working-group members and the progress made towards adoption of the codes of practice as outlined. I add my support to the calls for the Government to implement the report at speed. Last year, a court ruled that letting agents are no longer able to advertise properties as unavailable to those in receipt of universal credit. What steps have the Government taken since to prevent this discrimination? Does the Minister agree that implementing the codes of practice would prevent such discrimination in future?

Photo of Lord Greenhalgh Lord Greenhalgh The Minister of State, Home Department, Minister of State (Department for Levelling Up, Housing and Communities)

My Lords, we recognise that having an overarching code of practice will be an important step in addressing these issues around discrimination. That is why we are looking forward to receiving the draft code compiled from the hard work done by the noble Baroness, Lady Hayter, and others. We will come back in due course on how we take that forward.

Photo of Baroness Pinnock Baroness Pinnock Liberal Democrat Lords Spokesperson (Levelling Up, Communities and Local Government)

My Lords, leaseholders in cladding-scandal-ridden flats have seen a meteoric rise in their service charges. Emily in Leeds has seen hers rise from £400 per year to nearly £3,000 per year. The Minister has said this afternoon that he is committed to leaseholder fairness. Regulation is urgently needed to save these leaseholders from bankruptcy. When—not if—will the Government introduce regulation?

Photo of Lord Greenhalgh Lord Greenhalgh The Minister of State, Home Department, Minister of State (Department for Levelling Up, Housing and Communities)

My Lords, as the noble Baroness knows, the Building Safety Bill is currently going through the other place. We strongly believe that all fees and charges should be justifiable, transparent and communicated effectively. By law, variable service charges, and pollution and administration charges, must all be reasonable, and, where costs relate to work or services, those must be of a reasonable standard. There are already significant legal protections in place.