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Estate Agents

The Estate Agents Act, and subsequent Orders, lay down the duties agents owe to clients and to third parties, and gives the Office of Fair Trading (OFT) the power to issue warning or prohibition notices against those persons it considers unfit to carry on estate agency work.

The Property Misdescriptions Act makes it an offence to make false or misleading statements about property offered for sale (see link).

Both Acts are enforced by local Trading Standards departments and the Office of Fair Trading. For further information see our Fact Sheet pages.

Consumers, Estate Agents and Redress Act

The Consumers, Estate Agents and Redress Act 2007 (CEARA 07) takes forward measures in the Government response to the OFT report on the estate agency market in England and Wales and amends the Estate Agents Act 1979.

Since 1 October 2008 all estate agents in the UK who engage in residential estate agency work have been required to belong to an approved redress scheme dealing with complaints about the buying and selling of residential property.

Other measures to improve the regulation of estate agents also came into force on 1 October 2008. These provide enforcers with increased powers to enter estate agents premises and inspect documents, and increase the grounds under which the OFT can issue warning and prohibition orders to estate agents.

We are planning to implement further provisions in CEARA 07 in 2011. We aim to introduce formal record keeping requirements for estate agents, who will be required to keep records of their transactions with consumers, including offer letters, for a period of 6 years.

The record keeping regulations have been included in the list of measures to be delayed to help businesses during the economic downturn. The earliest they can now be introduced is April 2011. We recently sought views on draft regulations and guidance to the regulations.

BIS study of the future regulation of estate agents

BIS has begun a project to look at the future regulation of estate agents. This study follows up the Government review of regulation and redress in the UK Housing Market, which identified gaps in the structure and basis of regulation and redress schemes, and calls by stakeholders for greater regulation.

We will consider the scope for consolidation in the light of recent developments including the Government review, the Consumer Law Simplification review, the Consumer White Paper, and FSA controls. The project will look at the prospects and options for revising the definition of estate agency and the evidence for change, taking into account latest developments in CEARA 07.

The project will assess the pros and cons of different ways of regulating estate agents that will be robust in differing economic conditions. The project aims to report in 2011. The study will run in parallel to the OFT home buying and selling market study, but will be independent of it.