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The largely unknown perils of consumer law which lurk to trap letting agents into expensive errors

February 8, 2016 by Tessa J Shepperson

Consumer law for letting agentsPeople generally think of property as an investment. It is not generally thought of as a consumer service. But that’s what it is.

With the massive increase of the private rented sector, government has been gradually ramping up the regulation. It is now substantial.

Letting agents, who manage the majority of rented properties, are their main targets. But as there are no qualifications required to be a letting agent, the majority are unaware of the perils that lurk in legislation.

But they can be deadly.

One horror story

One example will suffice. Under The Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013, businesses which make contracts off the trader’s premises (or after a meeting off the trader’s premises – for example a viewing of the property) must tell the consumer of their right to cancel the contract within 14 days.

If this is not done the consumer can cancel the contract and refuse to pay all fees.

In our consumer law online training course (more on this below) David Smith gives the example of  estate agents who failed to provide this notice and as a result (after their customer had raised the issue) were unable to charge them ANYTHING for the property sale they had just concluded. The fee would have been over £15,000 …

Probably the only reason this has not happened more often is because the regulations are little known.  At the moment …

Other consumer laws you may not be aware of include:

  • The need to belong to a redress scheme
  • Regulations regarding fee transparency
  • The consumer contract fairness rules in the Consumer Rights Act
  • The Consumer Protection from Unfair Trading Regulations
  • Rules relating to property misdescription
  • A tenant’s right to ‘unwind’ tenancies entered into as a result of unfair practices

All of these, along with other topics such as money laundering, are looked at in detail in a workshop on consumer law for agents with David Smith which Easy Law Training ran last September.

The background to the course

This was the first workshop which we filmed, and for a while I did not do anything with the film footage as I had a lot of other things to do at the time. In fact, I only got around to watching it over the Christmas break.

However, as soon as I started watching it I realised how critical much of this information was, not only for letting agents (for whom the course was designed) but also landlords and indeed housing advisors.

It has taken some time to sort out the film footage and get it online, but this has now been done and you can read about it here.

The course is taken by solicitor and RLA Director of Policy David Smith, and so is interesting, entertaining and deeply relevant.  There is some background noise in the audio which is not perfect but the course content is spot on.

Why this course is essential watching

I think I would go so far as to say that the information contained in this course is crucial (and critical) for all letting agents. You must know these laws. You can suffer massive losses if you don’t.

Although these rules are little known, this does not mean that enforcement action will not be taken against you or that your customers will not take advantage of your ignorance.

Landlords also need to watch this course. Many of the consumer laws apply to you too. If you use letting agents, you need to know what your rights are.

Finally, it will be extremely useful for anyone who gives advice to anyone in the private sector. You need to know these things to be able to advise properly.

Easy Law TrainingFind out more and book your place here.

Or watch a clip from the course below:

 

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IMPORTANT: Please check the date of the post above - remember, if it is an old post, the law may have changed since it was written.

You should always get independent legal advice before taking any action.

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About Tessa J Shepperson

Tessa is a specialist landlord & tenant lawyer and the creator of this site! She is a director of Landlord Law Services which runs Landlord Law and Easy Law Training.

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