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Aimed at raising awareness and standards in the property industry, our quarterly expulsions update offers some insight into what leads up to the PRS’s decision to expel a member, following a lengthy disciplinary process. This list of agents expelled by the PRS includes an explanation of the facts that we considered when assessing each case, and the outcome, including details of any award made.
The landlord chased the agent for rent that had not been passed on (£495), but received no response. One month later the agent sent an email just saying that the company was closing. The email made no reference to the outstanding rent or any next steps. The complainant was claiming the rent and a £55 management fee refund. The PRS decision awarded the outstanding rent in full and, due to the lack of any communication and poor service, also awarded £155 in compensation, totalling £650. This agent had 15 complaints in a 12-month period, and all were for unpaid rent.
The complainant claimed there was 10 months’ rent outstanding which they should have received, as they had a guaranteed rent agreement with the agent, and that the agent had been poor at responding to communications. The agent claimed that the tenant had not paid any rent, which is why it had not been paid to the landlord. The agreement provided confirmed the landlord was guaranteed the rent, whether the tenant paid or not. This decision was made at the early resolution stage and awarded the complainant all the rent (£10,450) from the tenancy start date. The decision also found that the agent had provided poor service by not replying to the complainant’s emails or answering his calls. This led to an additional award of £600 for stress and inconvenience. This proposal was agreed by the agent who just did not comply.
The complainant signed an agreement, containing a clause which said that all fees are non-refundable, and paid an initial £99 membership fee. The complainant subsequently paid a £4800 ‘reservation fee’ for a property after viewing the details that were sent to him. Following this payment, the agent avoided calls and emails, and no contractual papers were sent to the buyer’s solicitor. The seller then withdrew the property from the market and the agent said that they were happy to roll on the fee and provide alternative investment opportunities. The complainant asked for a refund as no alternative properties offered fitted the criteria and then waited six months before raising this complaint. The decision awarded a full refund of the £4800 reservation fee, finding the non-refundable fee clause unenforceable and unfair as it was no fault of the complainant that the deal fell through. However, the membership fee of £99 was not refunded as the buyer continues to benefit from that payment.
The complainant requested the agent pay the £600 rent outstanding for January 2023, which he knew the tenant had paid, and, due to this non-payment, sent notice to the agent to terminate the management agreement, requesting various keys and documents be handed over. The agent provided no response to the complaint or any supporting evidence. The decision was made on the complainant’s evidence alone, which contained a copy of the tenant’s bank statement showing the rent payment. The decision awarded the £600 rent in full (tenant’s bank statement), £150 compensation for stress and inconvenience and to provide the documents requested.
The complainant said that the agent delayed sourcing a tenant, the rent guarantee scheme was not explained properly and the general level of service was poor. The agent claimed that they always acted professionally and in line with their terms of business, that a suitable tenant was found in a reasonable time, the rent guarantee was fully explained, and the complainant was not misled. The agent also said that the agreement with the landlord had ended due to the landlord’s excessive attempts to contact them multiple times a day, making unreasonable demands. In the decision, the agent was not found to have delayed sourcing a tenant and given credit for the easy transition to the new agent and waiving termination fees, but was found to have provided poor service in responding to the complainant and keeping them updated about rental payments, so a £75.00 compensation award was made to the landlord.
Rent to rent, or guaranteed rent agreements, are an increasingly popular property strategy, but, as this quarter’s expulsions illustrate, it’s important for agents to make sure that they fully understand their obligations and responsibilities. At the PRS and the Property Redress Scheme Tenancy Mediation Service, we’ve seen an increase recently in requests for mediation from property owners in relation to corporate lets or guaranteed rent agreements, where the relationship has broken down or the rent to rent operator has failed to fulfil their obligations.
For more information on rent to rent, read our article. We’ve also created three guides for agents, tenants and landlords who may be involved in guaranteed rent or rent to rent arrangements, which are available in the PRS resource section of our website here. For additional guidance on rent to rent, read our deposit protection partner, mydeposits, ultimate guide to rent to rent.
For the latest complaints statistics from the Property Redress Scheme, as well as the thoughts and opinions of over 3,000 landlords and agents in the results of our sentiment survey 2022, read our interactive annual report.
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