More pressure is being piled on the Government to regulate letting agents and drive out the rogues, following the latest Which? report.
It said that its new study into the lettings market had uncovered bad practice, unexpected and unfair fees, and a lack of protection for both landlords and tenants.
It said people were playing ‘renting roulette’ – gambling as to whether they chose a bad or a good letting agent.
The Which? report follows hard on the heels of the RICS report last week which suggested that the private rented sector was the ‘Wild West’ of the property market, and during an ongoing Shelter campaign letting agents’ fees.
Shelter has already won a campaign in Scotland to have agents’ fees to tenants declared explicitly unlawful. It is now gathering evidence in England.
The RICS report last week said that there were ‘corrupt’ letting agents around. It called for government legislation but said in the absence of that, the public should opt for agents who were members of voluntary regulators.
But the Which? report shows there is very little awareness of bodies such as the RICS, National Approved Letting Scheme (NALS) or Association of Residential Letting Agents (ARLA). Two-thirds of tenants (62%) and nearly half (45%) of landlords did not know whether their agent was a member of a professional body.
Meanwhile, the Government is in the process of conducting its own consultation into the private rented sector. In particular, it is looking at the fees charged by agents, mandatory regulation of both agents and landlords and the introduction of rent controls.
The Which? report said that out of the 32 agents it specifically looked at, not one had information as to its fees on their website.
It also says that it found evidence of agents using aggressive sales tactics, and misleading tenants through out of date adverts.
Most worryingly, it says that both tenants and landlords have lost money, with agents not passing on rents or failing to protect deposits.
The Which? report, like last week’s RICS paper, is calling on ministers to extend the legislation which currently applies to estate agents to letting agents.
The Property Ombudsman has also repeatedly called for the Estate Agents Act to be amended to include letting agents. This would mean that they would have to offer a redress service, and the Office of Fair Trading would have the power to ban lettings agents, in the same way that they can (although they rarely do) bar estate agents.
The Which? report is also calling for letting agents to be more transparent about the fees they charge, both in adverts and on their websites, and to provide full details of terms and conditions before any upfront fees are paid.
Which? found a wide discrepancy in fees during a mystery shopping exercise. For example, a credit reference check for a single tenant could be anything from £43 to £90, while some agents charged nothing for a check-in fee and others charged £60. Administration fees ranged from £120 to £420 and deposit admin fees ranged from nothing to £29.
The Which? report was based on a survey of 1,006 tenants, plus one of 506 landlords, all of whom had used an agent in the last two years. There were also focus groups, further analysis of Citizens Advice complaints data, and the mystery shopping exercise of 32 agents in Nottingham, London, Birmingham and Leeds.