Gazump­ing to be banned in shake-up

The Sunday Telegraph - - News - By Is­abelle Fraser PROP­ERTY ED­I­TOR

THE Gov­ern­ment will crack down on gazump­ing with new mea­sures tar­get­ing the es­tate agency in­dus­try and make the process of buy­ing prop­erty eas­ier for con­sumers.

It an­nounced a raft of changes to over­haul the largely un­reg­u­lated sec­tor, which has long suf­fered from be­ing seen as anti-con­sumer.

The plans in­clude en­cour­ag­ing the use of vol­un­tary reser­va­tion agree­ments to stop sales from fall­ing through and end­ing the prac­tice of gazump­ing, where sell­ers ac­cept higher of­fers fol­low­ing an agree­ment to sell.

The Gov­ern­ment also plans to get rid of “rogue agents” by en­sur­ing that all es­tate agents have a pro­fes­sional qual­i­fi­ca­tion. It will also make it a re­quire­ment for these com­pa­nies to be trans­par­ent about whether they re­ceive fees for re­fer­ring clients to mort­gage bro­kers, sur­vey­ors or so­lic­i­tors.

Sa­jid Javid, the Sec­re­tary of State for Hous­ing, said: “Buy­ing a home is one of the most im­por­tant pur­chases some­one will make in their life. But for far too long, buy­ers and sell­ers have been trapped in a stress­ful sys­tem full of de­lays and un­cer­tainty. So we’re go­ing to put the con­sumers back in the driv­ing seat.”

Re­search car­ried out by the Gov­ern­ment found that more than six in 10 peo­ple who bought or sold prop­erty have ex­pe­ri­enced stress due to de­lays in the prop­erty trans­ac­tion process.

The mea­sures come from a con­sul­ta­tion held last year. More ex­treme pro­pos­als, such as cre­at­ing fi­nan­cial penal­ties for buy­ers who pull out of pur­chases and cause chains to col­lapse, are not in­cluded in the new plans.

Some agents choose to be mem­bers of bod­ies such as the Na­tional As­so­ci­a­tion of Es­tate Agents or the Prop­erty Om­buds­man. How­ever, these or­gan­i­sa­tions lack power, and there are no re­quire­ments for es­tate agents to have a for­mal train­ing or cer­ti­fi­ca­tion, un­like in the US. It is un­clear what kind of qual­i­fi­ca­tion the Gov­ern­ment will man­date, and it will hold another con­sul­ta­tion to work out how es­tate agents can be brought up to stan­dard like con­veyancers, so­lic­i­tors and sur­vey­ors.

Russell Quirk, chief ex­ec­u­tive of on­line es­tate agency Emoov, said: “This is re­ally great news. The in­dus­try and Gov­ern­ment have talked for a long time to clean up house buy­ing. If you add both speed and cer­tainty to the process, there will be fewer trans­ac­tions fall­ing through, less wasted money, and less con­sumer stress.”

He added: “For far too long, it has got away with be­ing al­most en­tirely un­reg­u­lated. How can it be that fi­nan­cial ad­vis­ers deal­ing with the loan for the prop­erty are vet­ted, but the peo­ple deal­ing with the as­set it­self are not over­seen or li­censed.”

This is not the first mea­sure to hit the in­dus­try. Last year, the Chan­cel­lor an­nounced a ban on let­ting fees which is due to start next year.

Becky Fatemi, man­ag­ing direc­tor of Lon­don es­tate agency Rok­stone, said: “Rogue agents are small in num­ber, but sadly the be­hav­iour of ‘wide boys’ gives the in­dus­try a bad rep­u­ta­tion.”

As part of the Gov­ern­ment’s plan to pro­tect lease­hold­ers, it also said it would re­quire man­ag­ing agents and free­hold­ers to pro­vide lease in­for­ma­tion and a fee timetable in or­der to stop free­hold­ers wield­ing power over their lessees.

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