Redress Scheme Membership during Coronavirus
Advice from National Trading Standards Estate and Letting Agency Team (NTSELAT)
Mandatory Redress Requirements
There are three categories of mandatory redress requirement:
- Estate agency work – essentially the introduction by an agent of a buyer to a seller (or vice versa) and the work done to secure the disposal or acquisition of the land in question.
- Letting agency work – the introduction by an agent of a tenant to a property, or the introduction by an agent of a landlord to a tenant
- Property management work – an agent acting on behalf of a landlord to manage a property being let to a tenant
There are various exemptions to the above, but this is principally the case in most situations. Agents need to be registered for the relevant discipline(s). Registration for redress is a legal requirement and businesses must maintain their membership if they are engaging in any of the above work.
The Coronavirus restrictions have led to a number of estate and letting agency businesses closing their customer-facing offices and furloughing some of their employees. Some agencies have suspended all new sales and lettings work; others are continuing to facilitate critical moves or dealing with vacated property. The government has issued guidance in relation to home moving and renting during the period of restriction.
- If a business stops trading – i.e. winds up a company or closes the business, they will no longer need to be a member of a redress scheme.
- If a business suspends operations, but has customers on its books (i.e. instructed sales, tenants/buyers looking for properties), or is marketing properties (on its website, or on portals), or is collecting rent from tenants, or managing property on behalf of a landlord, then they will need to maintain their membership of a redress scheme.
Redress schemes are required to report all instances of a failure to renew redress membership by an agent to NTSELAT in a timely manner.