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To ask Her Majesty’s Government whether they will institute a review of the practice of estate agents requiring pre-contract deposits in the process of purchasing homes.
The Government has no plans to review the practices of estate agents. The conduct of estate agents is governed by legislation – Estate Agents Act 1979 - which sets out the duties estate agents owe to clients and third parties. Under the Act all estate agents in the UK engaged in residential estate agency work are required to join an approved redress scheme so that consumers can seek free and independent redress from an approved body.
Estate agents who are members of The Property Ombudsmen (TPO) are required to comply with the TPO’s Code. The Code sets out requirements in relation to pre-contract deposits. Breach of the Code could result in removal from the redress scheme – this will effectively prevent them from operating as an estate agent.
Estate Agents are also required to comply with other consumer legislation to prevent or prohibit unfair practices in their dealings with consumers.