Skip to main content

Housing: Letting Agents

Volume 785: debated on Tuesday 31 October 2017


Asked by

To ask Her Majesty’s Government whether they are planning to introduce legislation to require letting agents to join a registration scheme.

My Lords, my right honourable friend the Secretary of State recently announced a package of measures better to protect tenants, including that all letting agents will have to register with an appropriate organisation. This will give landlords and tenants confidence that their agent meets minimum standards. On 18 October we published a call for evidence, seeking views on the regulation of letting and managing agents. The Government will consider the feedback and work with the sector to shape the regulatory framework ahead of introducing legislation.

I thank the Minister for that Answer. As he knows, I have already welcomed the commitment that letting agents will in the future be required to register. However, I question the phrase “in the future”. As the Minister knows, the Government agreed in March to introduce client money protection for letting agents. It is now the last day in October. Perhaps he can give some reassurance to the House that both client money protection and this new measure will happen without any delay.

I thank the noble Baroness, whom I know has taken an interest in client money protection in particular. She has been very patient; I know that previously I have said “in due course”, “soon” and “very soon”. I can confirm to her that it will be this week. I hope that that pleases her.

My Lords, does the Minister realise that although this is a good first step and will certainly do something to control rogue letting agents, there is a great need to control rogue landlords as well? Is it not time to give the power back to local authorities to check more carefully on properties, in order to be sure that they are legally sublet and not just converted for pure commercial gain, thereby risking people losing their housing?

My Lords, my noble friend has raised this issue on occasion; I am grateful to her. She will be aware that there are considerable powers to proscribe bad landlords, which are exercised, and there are powers to fine them. We will bring in additional banning provisions before next April, which I am sure will please her. However, there is already a battery of powers with regard to poor landlords.

My Lords, I thank the Minister for confirming that the measure, which was really an enabling part of the legislation, will be introduced shortly. However, can he and his department also commit to putting real resources into enforcement to ensure that rogue letting agents are driven out of the market? Furthermore, will he take back to the Government the possibility of ring-fencing the fines and compliance costs so that, when those moneys are obtained by local authorities, they can be used for enforcement rather than for other matters?

I am grateful to the noble Lord, whom I know has done a lot of work on client money protection. I reiterate that the consultation will be forthcoming this week, along with the draft Bill on letting agents. The noble Baroness, Lady Grender, who is not in her place at present, has worked hard on that. We are concentrating resources on tackling bad landlords and are doing what we can to improve the market, which is important to us all.

My Lords, the concentration on bad landlords seems to be a precursor to a judgment of all landlords. How will the Minister ensure that good landlords, who serve a vital role in our society, are not so labelled?

My Lords, I am grateful to the noble Lord for that question, as it gives me the opportunity to say that most landlords are good landlords. I do not agree with the hypothesis that, by bringing in legislation to deal with poor landlords, we are saying that all of them are poor, any more than the Theft Act means that everybody is a criminal.

My Lords, tax evasion by landlords is rife in London. Could a registration scheme be set up in such a way that an agency that registered had to inform HMRC of the tenancies in which it had been involved?

My Lords, if the noble Lord is aware of any tax evasion, I would be very grateful to hear about it and would then pass the information on to the Treasury in the usual way. I am not aware of this being as widespread as he perhaps suggests, but obviously the Government are keen to make sure that everybody pays the appropriate taxation that is due, so I would be glad to see any evidence that he has.

My Lords, the Minister mentioned that new powers may be coming in for local authorities to tackle errant landlords. Will they include holiday lets, which cause a major problem? Often companies buy up 70% to 80% of villages, causing all sorts of social problems. Can that be brought into the raft of actions that the Government are talking about?

My Lords, I know that the noble Lord speaks with particular feeling about his area of the Lake District, and I am aware of the pressures that sometimes exist there. As he will be aware, there is separate legislation for short-term lets in London. A voluntary code has now been adopted by members of the association relating to short-term holiday lets. I think that that will make a difference and the department is looking at it very closely.