PRESS RELEASE

Thousands of pounds of landlords and tenants cash could be at risk as the uncertainty over the property market threatens the future of some estate agencies, a Cardiff agent has warned. More people are turning to renting out their property while waiting for the market to recover, but they may be unaware that not all estate agents insure tenant’s deposits and rent monies

Andrew Thomas of Chris John & Partners in Cardiff warns landlords to ensure the firm they choose to work with is reputable, and regulated by a professional body such as the Association of Residential Lettings Agents (ARLA). Landlords and tenants alike are advised to wise up about the industry and make sure their money is protected.

“In a difficult sales market, some estate agents are looking to establish a lettings business to offset falling income from sales fees. But they may not be trained correctly, may not have any client money safeguards and be unaware of a lot of current legislation. As a result they could be putting their landlords at risk.”

“The residential lettings industry is very specialised, with complex legislation. In particular, recent legislation in April 2007 made it a legal requirement for tenants’ deposit monies to be held in an approved scheme. Failure to do so can result in a landlord being unable to serve the proper notice required for possession of the property and being fined three times the value of the deposit. The first couple of cases are apparently going through Cardiff County Court at the moment.”

The warning came in the same week Sir Bryan Carsberg, former Director of the Office of Fair Trading, released a report saying letting agents need  regulating to offer customers better protection. Inexperienced landlords may be tempted to use agencies which are not members of ARLA or other self-regulating bodies such as NAEA or RICS which require members to work in line with a strict code of conduct. This includes, vitally, the protection of rent & deposit monies.

Mr Thomas, recently elected ARLA Vice-President said “No more than half of the letting agents in Wales are regulated in this way. I want to see quality agents, and there are many, recognised for the good service they provide. But it’s high time a compulsory system of licensing or accreditation were introduced to protect consumers and ratchet up standards. If government in Westminster continues to fail to act on this issue then we believe the Welsh Assembly could and should step in to regulate the lettings industry in Wales.”

Cardiff County Council have recently successfully prosecuted two agents in Cardiff for fire precaution failures and Housing Benefit fraud. Landlords and tenants have also been embroiled in rows over unpaid rent and lost deposits with some firms shutting up shop at a moment’s notice. In one such case reported in the South Wales Echo last year hundreds of thousands of pounds went missing and much of this cash now looks irrecoverable. None of the agents involved belonged to a professional body.