The Property Ombudsman | Press Releases 2010

The Property Ombudsman, Christopher Hamer, is renewing his call for residential property letting agents to be brought under the umbrella of redress legislation.

Mr Hamer first made his appeal in March this year as he launched his annual report for 2009, saying that whichever party won the General Election in May it should make some form of protection for tenants and landlords a priority.

After the formation of the Coalition government in May, Grant Shapps the housing minister, made it clear that any form of legislation to regulate the lettings sector would not be a priority.

'More and more people will be looking to the private rented sector for their housing needs whether because they cannot get financing to buy a property or because government cuts will possibly impact on the availability of public sector housing. It is now more than ever imperative that consumers in the private rented sector gained some protection,' said Mr. Hamer as he launched his latest Interim Report for 2010, released today.

'If the Coalition was to review its stance, it could easily gain a quick win by expanding the scope of the Consumers, Estate Agents and Redress Act 2007.

'That Act required all residential sales agents to join an approved redress scheme to settle disputes between consumers and agents. Encompassing a similar obligation for letting agents would be an obvious consistency and could result in the entire sector (not just those firms who have voluntarily agreed to follow its standards) operating in accordance with the TPO Code of Practice.

'Our Code is not a heavy-handed regulatory regime. But taking this simple step would mean that the whole industry has parity and no firm would be outside the standards. It would make competition fairer while offering consumers greater protection. I recognise that full coverage of the market place through a formal regulatory structure can only come about through significant legislation but if the government was to take a positive view of my proposals and encourage the industry itself to establish a relevant regime I am enthusiastic about contributing to that concept.'

Mr Hamer hopes to arrange a meeting with Mr. Shapps to press the case for a change in legislation.

'More than 7,000 lettings offices in the UK are already signed up to the TPO Lettings Code of Practice voluntarily so clearly a large proportion of the industry itself sees this move as necessary,' adds Mr. Hamer. 'My report shows there is still a large number of complaints regarding lettings agents, numerically on a par with sales agents for whom TPO membership is almost double the size.

'Visiting estate agents and talking to them about industry issues is a large part of my job and with the backing of legislation to force all lettings agents to join an approved redress scheme it would be much easier to know who is operating in the market and to observe their standards.'

Figures in the interim report show that sales agents and lettings agents ended the quarter with the same number of cases (150) being opened for both industry sectors. But lettings agents generated far more enquiries than sales agents in the same period – virtually 70 per cent higher at 1,975. This is vastly different from the variance in earlier quarters of 2010 although a lightly less dramatic rate of climb than for the same period last year.

'What concerns me more is that when you survey the membership figures, there are 46 per cent more sales agents in the scheme than there are lettings agents,' said Mr. Hamer. 'The ratio of enquiries to membership numbers is one for every 9.7 sales offices compared with one for every 3.9 lettings offices. Clearly there is work to do in the lettings sector to improve standards and bringing lettings agents into the scope of CEARA would be a realistic and easily achieved first step.'

End

Notes for editors:

TPO had 7,908 member firms at the end of September, 2010, operating 11,310 residential sales and 7,756 residential lettings offices.

Enquiries figures for this and the previous five quarters

	Q2 2009	Q3 2009	Q4 2009	Q1 2010	Q2 2010	Q3 2010
Total	3204	3430	2965	3318	3382	3701
Sales	1076	966	850	1084	1135	1164
Lettings	1446	1679	1413	1621	1679	1975
Other	147	107	99	n/a	n/a	n/a
General	385	458	387	393	334	323
Insufficient Information	150	220	216	220	234	239

New cases opened in this and the previous four quarters

	Q2 2009	Q3 2009	Q4 2009	Q1 2010	Q2 2010	Q3 2010
Total	221	249	230	354	329	300
Sales	104	122	128	183	158	150
Lettings	117	127	102	171	163	150

The Property Ombudsman scheme (www.tpos.co.uk) offers a free, independent, and impartial service to members of the public who are dissatisfied with the service provided by an estate agent who is a member of the scheme during the buying, selling, or letting of a residential property. The Ombudsman, Christopher Hamer, can recommend member agents pay compensation of up to £25,000 in any one case.

Any decision made by the Ombudsman is binding on member agents but not on complainants, who are free to reject the Ombudsman’s decision and pursue the matter in the courts if they wish.

OEA was founded in 1990 as the Ombudsman for Corporate Estate Agents. In 1998, it broadened its scope to make it available to all residential estate agents. From June 2006, the OEA extended its services to Lettings and Property Management agents. Recent expansion has also seen its redress scheme include some UK commercial property transactions and foreign property purchases in the UK.

With effect from 1 October 2008, all UK estate agents engaged in residential property sales are required under the Consumers, Estate Agents and Redress Act (CEARA) to register with an Estate Agents Redress Scheme that has been approved by the Office of Fair Trading (OFT) and which investigates complaints against estate agents. The OEA was the first scheme approved by the OFT and became TPOS on May 1, 2009.

For more information, contact Maurice Hardy at Ultimate PR on 01264 771661 / 07831 272220
Email: maurice.hardy@ultimatepr.co.uk

05 October 2010

New guides clarify property queries for consumers

Property Ombudsman Christopher Hamer is today launching a series of guides to help consumers who are buying, selling, letting, or renting residential property.

The four 'Essential Guides' are not intended to be definitive explanations of every aspect of the process as there are already publications to fulfil that role but rather they have been put together on the basis of issues that have given rise to complaints (whether supported or not) about estate agents.

'I see what causes the most complaints when people fall out with sales and letting agents and quite often it can be over simple misunderstandings,' explains Mr. Hamer.

'Through these Guides I am trying to help consumers be better equipped for dealing with agents and to be aware of the specific things that they should look out for and where they should perhaps ask more questions of the agent so that they fully understand the service being offered.

'Agents will say things that they themselves understand but perhaps do not take into account that those they are dealing with will not be equally as enlightened.

'Consumers are rarely experts in property transactions so I thought it would be helpful if they had some general and easily read guidance to help them understand the potential pitfalls. People can find these guides on my website and should refer to them before entering into a house sale or purchase or the rental market.

'A simple example of misunderstanding for buyers and tenants is that the agent is working for the person who is their client, normally either the vendor or the landlord. Although they also have a general duty to act fairly to others engaged in the process their contractual duty is to the person who instructs them.'

'The TPO Guides are a useful introduction for consumers to the world of property transactions and will help them understand the process better," said Mark McLaren, of Which?

"As the leading consumer organisation in the UK, Which? recognises that consumers need as much information as possible when buying, selling or renting property. That's why we publish comprehensive books on 'Buy Sell and Move House' and 'Renting and Letting' for those who wish to explore the topic more fully."

The series of Essential Guides is available free to download from The Property Ombudsman website at www.tpos.co.uk or they can be obtained from member estate agents. The Property Ombudsman’s role is to resolve disputes between estate agents and those with whom they have dealings that cannot achieve a satisfactory outcome through the agent’s own complaints handling process.

Mr. Hamer can order estate agents who are members of the scheme to make redress payments to complainants but does not have the power to punish estate agents by fining them. Neither does he enforce regulations, although he is active in making new laws through consultation with Government departments.

The Property Ombudsman scheme covers 7,908 member firms operating 11,310 residential estate agency sales offices in the UK and 7,756 handling residential lettings. Every residential sales agent in the UK must have a system of redress in place by law but the arrangement is currently voluntary for lettings agents.

End

Notes for Editors:

Any decision made by the Ombudsman is binding on member agents but not on complainants, who are free to reject the Ombudsman’s decision and pursue the matter in the courts if they wish.

OEA was founded in 1990 as the Ombudsman for Corporate Estate Agents, so has now operated for 20 years. In 1998, it broadened its scope to make it available to all residential estate agents. From June 2006, the OEA extended its services to Lettings and Property Management agents. Recent expansion has also seen its redress scheme extended to some UK commercial property transactions and foreign property purchases in the UK.

Useful links

http://www.which.co.uk/publications/books/property/

For more information, contact Maurice Hardy at Ultimate PR on 01264 771661 / 07831 272220
Email: maurice.hardy@ultimatepr.co.uk

30 July 2010

Wider role at TPO for Gerry Fitzjohn

Gerry Fitzjohn

Gerry Fitzjohn, national sales director covering more than 1,000 branches for Countrywide until earlier this year, is channelling his energies into a wider role with The Property Ombudsman Scheme.

Fitzjohn, an 'approved person' by the FSA and responsible for 700 financial consultants before taking on his new role of finding acquisitions for Countrywide, has become vice-chairman of the operating company for TPO, assisting chairman and chief operating officer Bill McClintock.

McClintock notched up a half century in estate agency last autumn but with 36 years agency experience behind him Fitzjohn is hardly a new boy to the business. He started as a sales negotiator with Taylors in 1974 and has since seen steady growth in his responsibilities which took him to the board of Countrywide in 2000.

That same year, Countrywide became members of the Ombudsman for Estate Agents scheme, as it then was, with Fitzjohn joining the OEA board at the same time.

'I am delighted to have been appointed vice-chairman of the TPO operating company,' he said. 'I have always been an enthusiastic supporter of the principles and aims of The Property Ombudsman and I am keen to help extend the profile of the TPO and increase membership still further.'

Bill McClintock said that Gerry Fitzjohn’s experience would be invaluable to TPO.

'Gerry has a great deal of energy and enthusiasm for TPO and his decade of inside knowledge will be of great assistance in helping promote the scheme and its aims,' he added.

'He is respected both within and outside the industry. My workload has grown substantially since I became chairman in 2003 and with redress now compulsory for all residential estate agents in the UK it is greater still.

'Gerry will be a great support to me and will, I am sure, make an even greater contribution to raising standards in residential estate agency.'

End

Notes for editors

Any decision made by the Ombudsman is binding on member agents but not on complainants, who are free to reject the Ombudsman’s decision and pursue the matter in the courts if they wish.

For more information, contact Maurice Hardy at Ultimate PR
Phone: 01264 771661 / 07831 272220
Email: maurice.hardy@ultimatepr.co.uk

11 June 2010

Minister's decision 'disappointing' says Property Obudsman

News that the coalition Government has scrapped plans to regulate letting and management agents has been described as 'disappointing' by Christopher Hamer, the Property Ombudsman.

Housing Minister Grant Shapps has announced that he will not be pressing ahead with a scheme for the registration of landlords or the regulation of letting agents.

'Whilst it was unrealistic to expect any legislation immediately, the decision by the Housing Minister potentially leaves landlords and tenants exposed to the rogue element in the lettings sector, particularly so in relation to client money protection,' said Mr. Hamer.

'I will continue to contribute to the current debate amongst industry bodies seeking a joined up and consistent approach to redress along with clear standards of business, consumer protection and awareness being developed and I hope Mr. Shapps supports this approach.'

TPO has already submitted its lettings Code of Practice for approval by the Office of Fair Trading. 'More than 7,500 letting agency offices have already adopted the standards in the TPO Lettings code but this still leaves many operating outside the scheme leaving consumers outside the scheme and without access to redress when things go wrong and complaints are not resolved,' added Mr. Hamer.

'Failing primary legislation, I would urge landlords and tenants to at least ensure they use a TPO member agent which gives them access to redress of up to £25,000 in any one case. They should also ensure they use a firm that is affiliated to a recognised trade organisation.'

End

Notes to Editors:

Any decision made by the Ombudsman is binding on member agents but not on complainants, who are free to reject the Ombudsman’s decision and pursue the matter in the courts if they wish.

For more information, contact Maurice Hardy, PR for The Property Ombudsman scheme, on 01264 771661 / 07831 272220

01 June 2010

TPO welcomes Carsberg's new industry role

The news that such an influential figure as Sir Bryan Carsberg is joining the E-Homebuying Forum this week as its first President is to be welcomed.

As a former Director General of the Office of Fair Trading and the author of the Review of Residential Property in 2008, Sir Bryan is well versed in both consumer protection and the workings of the property market in England and Wales.

His role in the speeding up of the home buying process will hopefully bring greater efficiency, transparency and cohesion to the home buying and selling process, the stated aim of the Forum.

The Property Ombudsman Scheme, which provides redress for more than 90 per cent of all residential estate agencies in the UK, has long held the view that transparency in property transactions is of paramount importance and would be happy to assist Sir Bryan in his efforts to achieve this.

'I believe that while speed is highly desirable, the most important factor in a property transaction is that every party is happy with the outcome of the process,' commented Bill McClintock, chief operating officer of The Property Ombudsman Scheme who recently marked 50 years’ involvement with the estate agency industry.

'Clearly, the number of complaints resulting from house sales shows there is still real progress to be made on this front and TPO has always tried to eliminate the causes of complaints through constant liaison with industry members.

'One of the biggest causes of delays in the buying and selling process is the assembling of the chain of transactions involved. But if the Forum can bring greater transparency to the market while speeding transactions then we would welcome this and be happy to assist Sir Bryan and the Forum in their work.

'Ultimately, consumers need to be informed at every stage of the process and the cause of many complaints investigated by the Property Ombudsman is lack of communication, an issue that clearly needs to be addressed by the Forum.'

End

Notes to editors

The Property Ombudsman scheme offers a free, independent, and impartial service to members of the public who are dissatisfied with the service provided by an estate agent who is a member of the scheme during the buying, selling, or letting of a residential property. The Ombudsman, Christopher Hamer, can recommend member agents pay compensation of up to £25,000 in any one case.

Any decision made by the Ombudsman is binding on member agents but not on complainants, who are free to reject the Ombudsman’s decision and pursue the matter in the courts if they wish.

For more information, contact Maurice Hardy, PR for The Property Ombudsman scheme, on 01264 771661 / 07831 272220

17 May 2010

Property Ombudsman warns over contract terms

Sales cases show unexplained rise in first quarter

The Property Ombudsman, Christopher Hamer, warns in his first interim report for 2010 that lettings agents including renewals commissions in their contracts must ensure they are clearly flagged up to landlords.

In the recent High Court case involving Foxtons and brought by the OFT, it was ruled that third party renewal commission and sales commission terms in lettings contracts operated to the significant detriment of consumers and were therefore unfair because they potentially required payment to the agent of a large sum of money (and an on-going liability in the case of third party renewals) where the agent provided no services in exchange.

'With regard to renewal commissions where the agent is conducting that renewal, the effect of the judgment is that such a term is not necessarily unfair but that it must be actively flagged to the consumer,' says Mr Hamer.

'As Ombudsman I have been asked to consider several cases where the renewal commission has been at issue. These pre-dated the judgment that has now been handed down by the Courts and I will now reflect that in any future cases referred to me.

'Previously I would not have rewritten a contract but might have awarded compensation if I felt the term had been not been drawn clearly to the client’s attention. The judgment will bring no change in my approach.

'I still feel it appropriate, however, that where a renewal of a tenancy is being discussed, best practice would dictate that the client is reminded of the liability he will face to pay such a commission fee.'

The report also shows a rise in enquiries during the first quarter of 2010 compared with the last quarter of 2009 – by 27.5 per cent in the case of sales and 14.7 per cent for lettings.

Mr. Hamer says there is no apparent reason for the rise between consecutive quarters and no identifiable trends among new complaints being brought to TPO.

'If the current trend in workload continues throughout the year my office will end up 48 per cent ahead of forecast; and new sales cases will match those for lettings,' he adds. 'At this stage I can only monitor the situation and over the coming months I may be able to identify whether it is more than just a sudden peak.'

End

Notes to editors

Enquiries figures for this and the previous four quarters

	Q1 2009	Q2 2009	Q3 2009	Q4 2009	Q1 2010
Total	3157	3204	3430	2965	3318
Sales	1002	1076	966	850	1084
Lettings	1489	1446	1679	1413	1621
Other	153	147	107	99	n/a
General	361	385	458	387	393
Insufficient Information	152	150	220	216	220

New cases opened in this and the previous four quarters

	Q1 2009	Q2 2009	Q3 2009	Q4 2009	Q1 2010
Total	192	221	249	230	354
Sales	102	104	122	128	183
Lettings	90	117	127	102	171

Any decision made by the Ombudsman is binding on member agents but not on complainants, who are free to reject the Ombudsman’s decision and pursue the matter in the courts if they wish.

For more information, contact Maurice Hardy, PR for The Property Ombudsman scheme, on 01264 771661 / 07831 272220

30 March 2010

Property Ombudsman’s call to next Government

Act swiftly to raise protection for landlords and tenants

Whichever party wins the forthcoming General Election, its new government should legislate to improve protection for landlords and tenants who use letting agents, says Property Ombudsman Christopher Hamer in his latest annual report.

'To my mind this needs addressing swiftly,' says Mr. Hamer in view of the increasing activity in the lettings market during the property sales downturn.

'In the meantime, my message to any landlord or prospective tenant is to ensure that they use an agent who is a member of a recognised trade association or any agent who is a member of The Property Ombudsman scheme. Such firms will therefore be adhering to the TPO Code of Practice. In the absence of any formal regulation, my Code lays down the standards by which firms should conduct their business.'

Mr Hamer considers it an alarming inconsistency that letting agents were not covered by the provisions of the Consumers, Estate Agents and Redress Act, legislation that forced all residential sales agents in the UK to register with an approved redress scheme and which has brought TPO membership to more than 90 per cent of all UK estate agents.

'Whilst many agents in the lettings business (a total of 2,241 companies with 7,200 offices at the end of 2009, and the numbers are growing) are in TPO membership and have shown that they want to apply high standards in all aspects of their business and afford dissatisfied consumers access to independent resolution of the matter through the TPO, there are still many firms operating under their own interpretation of what are appropriate standards,' adds the Ombudsman.

The proportion of Mr. Hamer's workload related to lettings disputes has steadily expanded while that related to sales disputes is now only 51 per cent. Lettings, which accounted for just 28 per cent of workload in 2008, provided the remaining 49 per cent.

He forecasts the trend will continue and in 2010 two thirds of all complaints will be on the lettings side, partly because there is increased awareness of the scheme among consumers but also because TPO is attracting a greater number of letting agents voluntarily signing up to follow the TPO Code of Practice for Letting and Management Agents.

During 2009, the lettings workload increased 45 per cent over 2008 from 300 cases to 435. Despite that, TPO's overall workload reduced by 15 per cent simply because the number of sales disputes referred declined - perhaps inevitable, says Mr Hamer, given the market conditions over the past year.

'I do believe from the cases I see that sales agents are causing less need for sellers and buyers to refer to my office,' adds Mr. Hamer. 'Although I was asked to resolve many disputes, 562 last year as opposed to 799 in 2008, many of the issues related to misunderstanding or lack of clear communication between the parties, rather than because of a specific failing by the agent.

'Every complaint is, of course, serious for the person who feels disadvantaged, but I can detect that the matters being presented to me are mostly less serious. This is, perhaps, manifest by my awards averaging £339 during 2009 as against the 2008 average of £666.

'I have many more sales agents in membership than three years ago and I believe that the Sales Code of Practice has played a part in this improvement by providing a platform as to how agents should conduct their business to avoid complaints arising.

'As we stand at the moment, the need to develop the approach to customer service, to 'up the game' in terms of treatment of customers, is on the lettings side. That might have been the message to sales agents in years gone by although I am not suggesting that they can now rest on their laurels.

'The necessary cycle of improvement in the lettings sector has not yet, to my mind, reached the stage that sales agents are now at. Time and, most importantly, signing up to redress and operating in accordance with the Code of Practice will make a significant contribution in that regard.'

During 2009, TPO dealt with 12,756 enquiries, a three per cent increase on 2008, and whilst a proportion related to general issues or were not relevant to the property sector, those that related specifically to matters within the TPO terms of reference increased by six per cent, with most significant element of that increase coming from lettings matters.

Although the main aspect of his role is to resolve disputes, Mr. Hamer says he also has a responsibility to contribute towards the establishment of best practice in the industry by giving out messages in annual and quarterly reports and by speaking about the work of TPO the issues he finds are causing difficulties with consumers. With that in mind, he plans to shortly launch essential guides so that everyone involved in the buying or lettings processes is better informed.

End

Notes for Editors

Any decision made by the Ombudsman is binding on member agents but not on complainants, who are free to reject the Ombudsman's decision and pursue the matter in the courts if they wish.

OEA was founded in 1990 as the Ombudsman for Corporate Estate Agents, so it is now in its 20th year of operation. In 1998, it broadened its scope to make it available to all residential estate agents. From June 2006, the OEA extended its services to Lettings and Property Management agents. Recent expansion has also seen its redress scheme extended to some UK commercial property transactions and foreign property purchases in the UK.

For more information, contact Maurice Hardy, PR for The Property Ombudsman scheme, on 01264 771661 / 07831 272220

18 February 2010

The way to drive up standards is to work together, says Property Ombudsman

The Office of Fair Trading's approach to the estate agency industry revealed in its report 'Home Buying and Selling A Market Study' contains some very positive statements for improving standards, says Property Ombudsman, Christopher Hamer.

And he adds that while a formal regulatory regime or new legislation may seem desirable, his experience shows such measures are not necessarily needed immediately to bring about better performance. However, if the market is opened up to new ways of selling houses, such as new internet services, there may be a need for fundamental change much sooner.

'The OFT wants the industry itself to drive improvement. Whilst that may be seen by some as impossible without some form of government intervention I would point to the impact the TPO Code of Practice has made over the past 20 years in driving up standards amongst sales agents,' adds Mr. Hamer.

'Until the Consumers, Estate Agents and Redress Act 2007 was implemented membership of the Ombudsman scheme was voluntary. When CEARA came into effect on October 1, 2008, more than 90 per cent of residential sales offices in the UK were members of my scheme – the majority had already signed up and agreed to adhere to the standards in the Code before it became compulsory, a positive development bringing about greater professionalism and greater consumer protection.

'The Code is easily understandable for agents and consumers alike and following it means good business practice and control at little cost to the agent.

'A formal regulatory regime would have potentially significant costs for the industry – those costs end up with the consumer and perhaps inevitably would lead to higher charges which are already often a source of dissatisfaction with those who feel that agents do not offer an acceptable service.

'Many agents I have spoken to appear to be enthusiastic about some form of licensing. Such a regime can only be seen as a good thing giving sellers and buyers confidence that the person they are dealing with is properly trained and licensed by a competent authority. Again that does not have to involve government intervention – the industry can build on what currently exists within initiatives being pursued by the National Federation of Property Professionals and the steering group for the proposed Register of Property Agents.

'I recognise that the current political environment means there is unlikely to be any wholesale change to legislation relating to home buying and selling.

'The market, though, is developing in its approach, use of technology and so on. The existing legislation for sales agents ranges from a 30 year old law (the Estate Agents Act 1979) through to a set of disparate regulations about various aspects of an agent's business and operation. I would support and encourage a review of how relevant these laws are to today's marketplace and to consumer expectations and protection.

'Whilst the industry can be encouraged to ever greater improvements, the relevant authorities should focus on those firms who display less support for improvement during the period any review of the legislation is taking place.

'That can be achieved partly by greater use of information which is available about firms' performance. Subject to legal restrictions, I support bodies such as ourselves passing information to Trading Standards or OFT about firms who act in a way which is clearly detrimental to consumers so that a proper decision can be made on whether those firms should continue in business.

'What is needed is a concerted and consistent approach by all concerned in the property sector.'

End

Any decision made by the Ombudsman is binding on member agents but not on complainants, who are free to reject the Ombudsman's decision and pursue the matter in the courts if they wish.

As of the end of January 2010, TPO has 7,351 member firms operating a total of 13,069 offices. Of these, 10,593 offices cover sales and 7,270 lettings (some have dual functions, which explains why the two figures exceed 13,069 when added together).

For more information, contact Maurice Hardy, PR for The Property Ombudsman, on 01264 771661 / 07831 272220.