Letting Agents in Swansea have been issued with a 28 day notice by the Property Ombudsman to prove they are being legally compliant when it comes to clearly displaying their fees to landlords and tenants. Agents who do not comply with this notice face further investigation by Trading Standards and a £5000 fine.
A recent survey of Swansea letting agents found that only 17 were displaying fees as required. Over half were not displaying fees chargeable to tenants and 62% were not displaying fees chargeable to landlords.
The Consumer Rights Act which came into force on 27th May 2015 clearly states that letting agents must publicise a full tariff of their fees, including VAT (value added tax – currently set at 20%).
also states that ‘This information must be displayed on your website and prominently at all premises where you deal face-to-face with tenants and landlords.’
Trading Standards Officers across the country have powers to enforce fines upon firms that fail to meet the legal requirement. Any agent found to be in breach of the law risks a fine of up to £5,000.
Katrine Sporle, Property Ombudsman, said: “The law is quite clear in that agents must disclose their fees – including VAT – so consumers can make an informed decision about what letting agent to use. Failure to do so is illegal and we will continue to work closely with CTSI, industry bodies and local authorities to raise awareness.”
The aim of this was to empower landlords and tenants to make considered, well-informed decisions on which agent to use. However, as there has been limited policing, agents have ignored their responsibilities in favour of keeping their fees hidden. Consumers are now in a more confusing situation than before and many are not even aware about the law.
In a statement to Property Industry Eye last month Hannah McCartan, Managing Director at McCartan Lettings, said: “As a business owner who is compliant, it is frustrating that the Government brings in this legislation for tenants and landlords to be more empowered, but it’s become more complicated and confusing than ever before as so many agents are not compliant. There’s no consistency.
“It’s not a level playing field and rogue agents are getting away with profiting from the confusion and lack of policing.”
“We have even had an incident of one landlord coming to us from another agency who was unaware he was being charged £90 a year for the management of the tenants deposit. This is something we highlighted to him that this is part of our full management service without extra charge.”
The Property Ombudsman is calling for the support of all letting agents in their campaign to protect consumers from unfair practices.