Page last updated at 09:01 GMT, Tuesday, 30 March 2010 10:01 UK

Letting agents should be regulated, says Ombudsman

To Let signs
Lettings have increased while sales have been in the doldrums

Letting agents should be regulated to protect both tenants and landlords, the Property Ombudsman has said.

In his latest annual report, Ombudsman Christopher Hamer said disputes with letting agents rose from 28% to 49% of his workload last year.

He predicted that problems over lettings would make up two-thirds of his workload this year.

Meanwhile, problems with sales agents dropped to just 51% of this total, partly due to the slump in the market.

Mr Hamer said that the depressed level of sales had led to more home owners letting their properties to tenants rather than selling.

"[My] overall workload reduced by 15% simply because the number of sales disputes referred declined - perhaps inevitable... given the market conditions over the past year," he said.

Smaller awards

Estate agents are required by law to be registered with an official redress scheme, and as a result 90% of all UK estate agents have signed up with the Property Ombudsman's scheme.

I can detect that the matters being presented to me are mostly less serious
Christopher Hamer, Property Ombudsman

But the situation, he said, was rather different with letting agents, who are not under any such obligation.

"Whilst many agents in the lettings business (a total of 2,241 companies) are in Property Ombudsman membership... there are still many firms operating under their own interpretation of what are appropriate standards," he said.

The purpose of the Ombudsman is to rule on complaints which have not been dealt with satisfactorily by the estate agent itself.

In the past year the problems they had caused led to smaller compensation awards than before.

"I can detect that the matters being presented to me are mostly less serious," Mr Hamer said.

"This is, perhaps, manifest by my awards averaging £339 during 2009 as against the 2008 average of £666."

Ian Potter, of the Association of Residential Letting Agents, said the body wanted to see a government-backed scheme for better control of letting agents.

"Until the government acts, we therefore urge all consumers to use an agent who belongs to a professional body and to ensure that their landlords also do so," he said.

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