The Council of Mortgage Lenders is lending its support to the Which? Move It campaign aimed at introducing mandatory regulation of estate agents.
With research showing that less than half of consumers think that estate agents pass all offers to sellers, when failure to do so is a criminal act, Which? is adopting the unprecedented approach of demanding that the government reject the recent Office of Fair Trading's 'woefully inadequate' recommendations to deal with the problem and act now to protect home-movers.
Which? is lobbying the government and industry to ensure that mandatory regulation happens as soon as possible. It says the government needs to undertake an immediate review of the Estate Agents Act and sees the present legislation as unenforceable, leaving consumers at the mercy of untrustworthy estate agents. Which? estimates that estate agents earn £4bn in fees per year from property – an average of £2,100 per transaction.
CML director-general Michael Coogan says: “In an environment where everyone else involved in the transaction will be regulated – the conveyancer, the surveyor, the broker, the mortgage lender – it is ironic that the estate agent, who is in many ways the most important player in determining the outcome of the house sale, is the only professional who does not have to meet stringent, compulsory standards.
“This situation cannot be right. As mortgage lenders, we know that most of the time people are much more interested in their actual house purchase or sale than they are about the mortgage, or the other associated services. Regulation is necessary to separate the wheat from the chaff in a sector whose standards are at present too variable.”
Which? says it has found that estate agents regularly break the law by, giving preference to buyers who use their mortgage services, by inventing offers to tempt buyers in to upping the price and by failing to pass on all offers to sellers in writing.
Nick Stace, director of Which? campaigns, says: “Dodgy practice has left the public exposed to the unchecked, often illegal whims of rogue estate agents for far too long. And the recent OFT report wimped out of a perfect opportunity to protect long-suffering home-movers.
“Which? is stepping in where the OFT has failed to ensure people get a fair deal when making the biggest purchasing decision of their lives.”