Q&A: Improved code for estate agents

Estate agents now have a tougher code to follow

The Ombudsman for Estate Agents is tweaking its code of conduct to give house sellers better protection from dud agents.

What is this code of practice for estate agents?

The code is a set of guidelines for how estate agents should conduct their business and deal with their customers.

It is overseen by the Ombudsman for Estate Agents, who deals with complaints from people who are dissatisfied with the response they got from the estate agent they are complaining about.

So how many estate agents are covered?

The Ombudsman now oversees complaints against 2,400 member firms covering more than 7,000 sales offices. That is about 55% of the total in the UK.

It is important to note that this set-up is purely voluntary.

Estate agents do not have to join and it is not a form of state regulation.

However the code has been given the stamp of approval by the Office of Fair Trading.

What can the Ombudsman do?

He decides if a complaint is valid or not.

If he agrees with a complainer then he can award compensation, potentially as much as £25,000.

In reality most awards are for between £100 and £500, with only six last year being for more than £3,000.

What is in this code?

There is quite a lot of it.

Generally, member firms are supposed to operate in line with a set of standards.

So, you are supposed to be treated legally, fairly and efficiently, and without undue delay.

As well as abiding by the law, estate agents must act in the best interests of their clients, and "never deliberately misrepresent the value of a property in order to gain an instruction".

More specifically they should give written details of fees and likely expenses, only put up a for sale sign with the customer's permission, and make sure anything they write or say about a property is accurate.

They must not favour potential buyers who agree to use the agent themselves for other things, such as selling their own property or buying an insurance policy.

Agents in the scheme should also have an in-house complaints procedure.

So, everything's fine then?

Well, lots of estate agents are not members, though last year the trade body the National Association of Estate Agents decided that all of its members must join.

Last year the Ombudsman received 2,334 complaint enquiries about member agents and 3,053 about non-members, about which it could do nothing.

Earlier this year the Ombudsman, Stephen Carr-Smith, called for his scheme to be compulsory for all estate agents.

And he said they should all be required to obtain a licence to show they are qualified and competent.