Letting agents in the UK play a crucial role in the rental market, acting as intermediaries between landlords and tenants. They provide a range of services for landlords, from marketing and advertising properties to collecting rent and managing maintenance issues. However, with so many letting agents operating in the UK, it can be difficult to know what rules and regulations they are required to follow. Let’s look at the basic rules and regulations that letting agents should comply with here in the UK.
What are the legal responsibilities of letting agents?
Letting agents help landlords keep their properties safe, well-kept, and on the right side of the law. But remember, landlords are still the ones responsible for following the rules and will be held accountable if they don’t.
If a letting agent doesn’t look out for the landlord’s best interests, they can be sued for being careless. So, it’s important for landlords to choose an agent who really knows the ins and outs of property rental laws.
Besides, letting agents have to follow the usual business rules and regulations as well as ones specific to renting properties.
Registration and licensing
There is a mix of different licence requirements for letting agents across the UK. Agents are required to register with a government-approved redress scheme which provides an independent resolution service for disputes between letting agents and their clients, i.e.; landlords and tenants. Failure to register with a redress scheme is a criminal offence which could result in fines of up to £5,000.
In addition to registering with a redress scheme, letting agents in Scotland must also obtain a letting agent registration number (LARN) from the Scottish government. This requirement was introduced in 2018 to improve standards in the sector and ensure that agents are fit and proper to carry out their duties.
In Wales, landlords need proper training and a license to manage their rental properties. If they don’t want to do it themselves, they can hire an agent to take care of it for them.
Letting agents in Wales also need to be trained and hold a Rent Smart Wales license.
In England and Northern Ireland, things are a bit different. There’s no official requirement for letting agents to be trained or licensed. However, many agents choose to get professional qualifications by becoming members of Propertymark, which holds them to higher standards.
Client money protection
Letting agents are often responsible for handling large sums of money including rent and deposits on behalf of their clients. To protect these funds, letting agents in England, Scotland and Wales must have client money protection (CMP) in place. This is a form of insurance that provides financial protection to landlords and tenants if the agent misappropriates their money.
The professional body for letting agents, ARLA Propertymark campaigned for this to be a legal requirement across the UK. They were successful with this coming into force in England and Wales on 1 April 2019. Letting agents in Scotland have been required to have CMP since 2018. While agents in Northern Ireland are not currently required to have it, this may change in the future.
Tenancy deposit protection
In the UK, most tenancy deposits must be protected by a government-approved tenancy deposit protection (TDP) scheme. These schemes ensure that tenants can get their deposit back at the end of the tenancy if they meet the terms of the tenancy agreement and have not caused any damage to the property.
Letting agents are responsible for ensuring deposits are protected within 30 calendar days of receipt (28 days in Northern Ireland). They must also provide tenants with certain information about the scheme protecting their deposit. As well as assisting in the fair and prompt return of the deposit at the end of the tenancy. Failure to comply with these requirements can result in fines of up to three times the deposit amount.
Data Protection
All letting agents are required to comply with the General Data Protection Regulation (GDPR) and the Data Protection Act 2018. This means they must obtain consent from individuals before collecting and using their personal data. Data must be kept secure, and only used for the purpose for which it was collected.
Letting agents must also be transparent about how they collect and use personal data. This must be outlined in a Privacy Policy which is published and easily accessible on their website. Individuals have the right to access the data that is held about them.
Failure to comply with data protection requirements can result in significant fines and damage to the agent’s reputation.
Letting agents’ responsibility to tenants
Although letting agents are instructed by the landlord and must act in their interest, they act as an intermediary between a landlord and their tenant and have a duty of care to all tenants.
If you’re renting, one of the most important responsibilities of a letting agent towards you as a tenant is to communicate with you clearly and provide you with accurate information about the property you’re renting.
This includes information about the rental price, the length of the initial tenancy, the deposit protection scheme, and any other relevant information about the property or the tenancy such as the council tax and energy rating.
Your rights and responsibilities will be set out in your tenancy agreement, which you should read carefully before signing.
Along with the agreement, you should also receive safety certificates, an energy performance certificate, and the Government’s How to Rent Guide before you move in.
Your letting agent should be quick and professional when answering your questions and keeping you updated on any changes to your tenancy agreement. They should also give you updated documents when needed during your stay.
If your letting agent, landlord, or contractor needs to visit the property, they should give you at least 24 hours’ notice, unless it’s an emergency or you’ve already given your permission.
Maintenance and repairs
Your letting agent must ensure that the property is well-maintained and that any repairs or maintenance issues are addressed promptly.
This includes ensuring that the property meets all safety standards and regulations. This includes gas and electrical safety checks and fire safety requirements.
Your letting agent should inform you about your duties as a tenant, including taking care of minor repairs.
They should have a system for handling maintenance and repair issues and respond to your requests within a reasonable time.
As long as the property meets health and safety standards, it should be maintained according to the inventory report’s condition.
Maintenance or repairs, whether done by you, the landlord, or a contractor, should only be “like-for-like.” Any upgrades are up to the landlord.
If your landlord or letting agent doesn’t meet their obligations to maintain the property, your local council can enforce improvements.
Hold a deposit in a deposit protection scheme
Your deposit must be protected in a government-approved deposit protection scheme within the required timeframe following the receipt of any funds towards your deposit (usually within 30 calendar days, apart from in Northern Ireland where the deposit must be registered within 28 days).
The deposit must not be more than the equivalent of 5 weeks’ rent and your landlord cannot request nor accept a deposit larger than this, even if you have a pet.
Your letting agent must provide you with information about the scheme and how to make a claim at the end of the tenancy.
They should also ensure you receive your deposit back promptly at the end of your tenancy, provided that there are no outstanding rent or damages.
Where there is a dispute over only part of the deposit, the amount not in dispute must be returned to the agreed party as soon as it is available.
Comply with regulations
They must also comply with all relevant laws and regulations, such as those related to data protection, health and safety, and tenancy agreements. This includes ensuring that the tenancy agreement is fair and complies with all legal requirements.
Letting agents should also ensure that they have appropriate insurance in place to protect themselves and their clients, and that they maintain accurate records and documentation.
Who ensures letting agents comply with rules and regulations?
Unless they are members of the professional body Propertymark, letting agents are largely unregulated in England and Northern Ireland. Although there are requirements for letting agents and in some cases landlords themselves to be licensed in Wales and Scotland.
However, if a letting agent is a member of Propertymark then they are required to adhere to a strict code of conduct, which includes providing high levels of customer service and professionalism.
What will a Propertymark letting agent do for me?
Agencies who are registered with Propertymark are required to comply with all relevant regulations and legislation. This includes those related to data protection, money laundering, and tenancy deposit protection.
This means that you can be confident that your letting agent is operating legally and ethically, based on current legislation.
Working with a Propertymark member agent can also help avoid potential scams or fraudulent activity, as you can be assured that their agent is operating within the law.
Standards matter
Individual Propertymark members are required to meet certain standards. This includes passing rigorous qualification exams, participating in continuing professional development, and adhering to the Propertymark Code of Conduct.
This gives you confidence in the agents ability to provide you with up-to-date, reliable and accurate expertise, whilst carrying out their duties in a professional manner.
They must provide clear information and be transparent
Propertymark members are required to be transparent, providing clear information to consumers about fees, services, and any other important information.
This helps Propertymark member agents to build trust and demonstrate their commitment to providing a high level of customer service.
How do I know if a letting agent Propertymark regulated?
To identify a Propertymark member agent look for the logo that all member agents display. Alternatively you can search the directory on the Propertymark website.
Last Updated: November 22nd, 2023
