Press Releases 2008

Consumers benefiting from higher standards

REPORT SHOWS ESTATE AGENTS AND THEIR OMBUDSMAN ARE PERFORMING BETTER

At a time when the relationship between consumers and estate agents is very much in focus, more agents are showing a commitment to improving their professional standards by signing up to the Ombudsman for Estate Agents Scheme and its Code of Practice.

With the Consumers, Estate Agents and Redress Act due to come into full effect this year, everyone who deals with a residential estate agent in the UK will have access to a redress system if they have a dispute with the agent that cannot be resolved.

The principal source of redress for consumers is the Ombudsman for Estate Agents, and in his annual report issued today the Ombudsman, Christopher Hamer, reveals that membership numbers have been growing far faster than the Enquiries received or the number of new cases investigated. The organisation covered 12,344 UK estate agency branches at the end of 2007.

He also reports that his own organisation has become more efficient, with a 63 per cent rise in the number of cases closed during 2007 when compared with 2006.

"People should be encouraged by the news in my report this year, the first report which covers a full year with me as Ombudsman," reports Mr. Hamer, who took up the post in December, 2006 and is only the third Ombudsman since the Scheme started.

"There is generally much more focus now on consumer redress, led in the residential property field by the OEA for 18 years. The introduction of HIPs last summer meant every residential estate agent in England and Wales was obliged to have redress in place for its HIPs activities, bringing a huge rise in membership."

"What's gratifying is that the vast majority of agents who registered for HIPs in fact did more than the legal minimum required and signed up to our full Code of Practice that covers all their activities. Estate agents in England and Wales volunteered to abide by the OEA Code of Practice and its stringent rules well before the new law has required it."

"While member numbers climbed by 60 per cent during 2007 the number of complaints received within my Terms of Reference only increased by 48 per cent for residential sales."

"At the same time as my staff had to deal with this huge influx of members, they also coped with closing more cases. During 2007 I resolved 795 cases compared with 489 resolved during 2006, an increase of 63 per cent."

"This means that as consumers have greater protection under the new CEAR laws, they can be assured that we at the OEA, if we become an approved Scheme, will do our utmost to see their dispute through to a satisfactory resolution as speedily as possible. If the new law is to have teeth then it needs to bring results within a reasonable time so that disputes do not become protracted and consumers disillusioned."

"The figures shown in my report hide an increase in disputes involving lettings, in all 99 cases. It should be remembered that the OEA did not deal with lettings disputes before the middle of 2006 and it took time for public awareness to grow."

"A more realistic overview of the situation involving lettings should be available next year, when we have two full years of lettings complaints to compare."

"During 2008, we will continue to advise and guide consumers who contact us, so that those who consider they have a grievance concerning an estate agent feel they have some support."

"Last year saw a 42 per cent rise in initial enquires, partly driven, I'm sure, by the fact the people are becoming more aware of our existence as a result of the publicity surrounding legislative changes."

"This can only be good for all those involved in the residential property market, whether it's in sales or lettings."

"The majority of disputes I receive are the result of failings by agents' administration such as the organising of viewings or in maintaining the security of keys to a property being marketed rather than any suggestion of malicious intent."

"More particularly, I have received many disputes, for example, about buyers being described as 'cash buyers' when they actually need a mortgage or will only be cash buyers when they have sold their own house; and other disputes about the way in which the original complaint was handled by the estate agent and misleading or imprecise property descriptions."

Lord Borrie former Director General of Fair Trading, who chairs the independent Council that oversees the OEA, commented: "At last legislation is catching up with what the OEA has been trying to achieve for many years."

"The new Act can only be good for all involved but especially consumers, who can now feel confident that disputes will be resolved by a system that is so much better than lengthy and expensive legal proceedings."

"The OEA costs them nothing to use - it is totally free to the consumer."

Notes for Editors:

The Ombudsman for Estate Agents Scheme offers a free, independent, and impartial service to members of the public who are dissatisfied with the service provided by an estate agent who is a member of the Scheme during the buying, selling, or letting of a residential property. The Ombudsman can recommend member agents pay compensation of up to £25,000 in any one case.

Any decision made by the Ombudsman is binding on member agents but not on complainants, who are free to reject the Ombudsman's decision and pursue the matter in the courts if they wish.

Christopher Hamer has a strong background in Ombudsman Schemes, starting as Private Secretary to the Parliamentary Ombudsman in 1984.

Immediately prior to joining the OEA, he spent six years with HSBC as Head of Insurance Product and Distribution Risk but previously he was General Manager of the Personal Investment Authority Ombudsman Bureau and before that, Director of Services at the Insurance Ombudsman Bureau.

The operation of the OEA Scheme is supervised by an independent Council with membership drawn from both consumer and industry representatives. It is chaired by Lord Borrie. As Director General of Fair Trading, he was in charge of the Office of Fair Trading from 1976 to 1992. Then known as Gordon Borrie, he became a household name and was made a Life Peer in 1995.

Lord Borrie has served on the Council of the Consumers' Association (now known as Which?) and has written on consumer law. He was also President of the Trading Standards Institute from 1992 to 1997 and was Chairman of the Direct Marketing Authority from 1997 to 2000. He became the Advertising Standards Authority's Chairman in January, 2001.

For more information or to arrange an interview with Christopher Hamer, call Maurice Hardy, PR to the OEA, on 01264 771661 / 07831 272220.

Tenants and landlords get greater access to redress with NALS and OEA initiative

The New Year has brought positive change for the lettings market. With effect from this week, tenants and landlords of properties across the UK will benefit from a new partnership between the OEA (Ombudsman for Estate Agents) and NALS (National Approved Letting Scheme) allowing easier access to independent redress to settle disputes and seek early resolution to issues.

The enhanced service for NALS accredited firms follows the appointment of the Ombudsman for Estate Agents, Christopher Hamer, who together with NALS has responded to a growing need within the private rental sector for independent redress. A solution has increasingly been sought that is effective, simple and delivers results but without involving extended and costly procedures to all parties.

Previously, NALS accredited lettings firms* had used arbitration as the final stage in the complaints handling process. The new agreement with the OEA gives independent redress for both tenants and landlords at NO cost to either party, and provides the lettings sector with a potentially faster, yet professional service, in line with best practice. The arrangement with the OEA will be funded entirely by NALS members. The procedure is based on seeking early agreement by all parties through a more informal decision process. Where this is not possible, OEA will carry out a full review of the complaint.

According to NALS Chair Caroline Pickering, the new alliance is a "win-win" for tenants, landlords and lettings agents: "It is our on-going aim to raise standards, add value and endorse best practice in the private lettings sector. And, of key importance is to support our accredited firms by securing the utmost credibility for them in their dealings with tenants and landlords. It makes total sense that adjudication should be open to both tenant and landlord in the unfortunate event that an intractable problem arises with a letting agent and here we have a solution that is cost-effective and straightforward for all parties - by recognising that early agreement is beneficial on all sides."

Christopher Hamer reinforced that the OEA had now been dealing with lettings issues for over 18 months and had gained valuable experience as a result: "In line with the growth in property rental, it is likely that there will inevitably be an increase in the number of disputes in months to come," he says. "It's a natural extension to offer independent redress to NALS accredited agents and their clients. People buying and selling properties in the UK have been able to use the services of the OEA for many years and it makes sense for those in the private rental sector to have the same opportunity."

NALS has more than 1,500 member offices and 1,200 accredited firms throughout the UK who recognise the benefit of promoting themselves in their local marketplace as part of an industry wide accreditation scheme.

RICS firms will continue to use their own arbitration scheme which is recognised by NALS

About NALS NALS is backed by the Government and the professional bodies in the lettings sector. NALS offers a reliable benchmark for landlords and tenants to compare the standards of service they receive from residential letting agents. All accredited firms commit to providing clearly defined levels of customer service, have client money protection cover, maintain professional indemnity insurance and operate a customer complaints procedure. For more information visit www.nalscheme.co.uk

The National Letting Scheme Board comprises: Caroline Pickering (Chair), representatives from Communities and Local Government (CLG), British Property Federation, RICS, ARLA, NAEA, the Guild of Letting and Management, Sanctuary Shaftesbury Housing, and the National Landlords Association.