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| Estate agents could face shake-up | Estate agents could face shake-up |
| (about 6 hours later) | |
| The estate agent sector could face a shake-up after the release later of a key report into people's experiences of buying a home in the UK. | The estate agent sector could face a shake-up after the release later of a key report into people's experiences of buying a home in the UK. |
| The Office of Fair Trading has been studying internet property sites, price competition between agents and consumer protection for the last 12 months. | The Office of Fair Trading has been studying internet property sites, price competition between agents and consumer protection for the last 12 months. |
| A recent survey suggested satisfaction with estate agents had improved. | A recent survey suggested satisfaction with estate agents had improved. |
| But there have been calls for more regulation, as anyone can set up in business as an estate agent. | But there have been calls for more regulation, as anyone can set up in business as an estate agent. |
| Market research estimated that the UK estate agency market was worth £6.7bn in 2007 from approximately 1.8 million transactions, although the subsequent house price slump has probably reduced this figure. | Market research estimated that the UK estate agency market was worth £6.7bn in 2007 from approximately 1.8 million transactions, although the subsequent house price slump has probably reduced this figure. |
| Satisfaction | Satisfaction |
| In 2004, a similar study by the OFT into the housing market - but only in England and Wales - found that there was widespread dissatisfaction with estate agents. | In 2004, a similar study by the OFT into the housing market - but only in England and Wales - found that there was widespread dissatisfaction with estate agents. |
| KEY AREAS OF REVIEW Are customers overcharged because of agents' links with associated services, such as surveyors?Are internet-based estate agents able to get a foothold in the market?Is the level of industry regulation sufficient?Can more be done to increase confidence in the market? | KEY AREAS OF REVIEW Are customers overcharged because of agents' links with associated services, such as surveyors?Are internet-based estate agents able to get a foothold in the market?Is the level of industry regulation sufficient?Can more be done to increase confidence in the market? |
| Buyers argued that some agents' descriptions of properties were misleading and that some failed to pass on offers to sellers. | Buyers argued that some agents' descriptions of properties were misleading and that some failed to pass on offers to sellers. |
| It prompted new legislation, including a requirement that all estate agents must be a member of a free ombudsman service that deals with any customer complaints and can order compensation. | It prompted new legislation, including a requirement that all estate agents must be a member of a free ombudsman service that deals with any customer complaints and can order compensation. |
| More controversial has been the introduction of Home Information Packs in England and Wales, or Home Reports in Scotland. | More controversial has been the introduction of Home Information Packs in England and Wales, or Home Reports in Scotland. |
| The latest market study - due to be published at midday - is considering whether competition has improved since 2004, and whether consumers are adequately covered by the new rules. | The latest market study - due to be published at midday - is considering whether competition has improved since 2004, and whether consumers are adequately covered by the new rules. |
| It will draw on research, published by the OFT in November, which found that 24% of estate agents visited by trading standards officers failed to comply with regulations in the industry. | It will draw on research, published by the OFT in November, which found that 24% of estate agents visited by trading standards officers failed to comply with regulations in the industry. |
| However, research published at the same time found that buyers' and sellers' satisfaction levels with estate agents had improved from 2004. It found 72% of buyers and 74% of sellers were happy with the service in 2004, but this had risen to 88% by 2009. | However, research published at the same time found that buyers' and sellers' satisfaction levels with estate agents had improved from 2004. It found 72% of buyers and 74% of sellers were happy with the service in 2004, but this had risen to 88% by 2009. |
| The Property Ombudsman has found that sales complaints have dropped away in 2009 owing to the state of the market. | The Property Ombudsman has found that sales complaints have dropped away in 2009 owing to the state of the market. |
| The bigger gripe for these people was with the individual buyer or seller on the other side of the transaction, or their solicitor. | The bigger gripe for these people was with the individual buyer or seller on the other side of the transaction, or their solicitor. |
| Changing picture | Changing picture |
| The housing market has seen major changes since 2004, not least with house prices. | The housing market has seen major changes since 2004, not least with house prices. |
| The house buying process has come under scrutiny before | The house buying process has come under scrutiny before |
| Prices rose sharply until the credit crunch led property values to plunge throughout 2008 before recovering to some extent at the end of 2009. | Prices rose sharply until the credit crunch led property values to plunge throughout 2008 before recovering to some extent at the end of 2009. |
| Estate agents were hit hard by the downturn, at a time when the methods of buying and selling homes were changing. | Estate agents were hit hard by the downturn, at a time when the methods of buying and selling homes were changing. |
| An increasing number of people have considered selling privately, selling at an auction, and - most significantly - using an online estate agent. | An increasing number of people have considered selling privately, selling at an auction, and - most significantly - using an online estate agent. |
| The latest year-long review has looked at how easy it has been for new internet-based agents to gain a foothold in the market. | The latest year-long review has looked at how easy it has been for new internet-based agents to gain a foothold in the market. |
| Regulation | Regulation |
| At the moment anyone can open up an estate agency without any qualifications or permission from any official body. | At the moment anyone can open up an estate agency without any qualifications or permission from any official body. |
| They can, though, be banned by the OFT if they subsequently break the laws about describing a property incorrectly, handling a client's money, not declaring an interest in a property, or engage in some other form of dishonesty. | They can, though, be banned by the OFT if they subsequently break the laws about describing a property incorrectly, handling a client's money, not declaring an interest in a property, or engage in some other form of dishonesty. |
| In a report published in June 2008, the former head of the OFT, Sir Bryan Carsberg, called for more regulation of the industry, and for Home Information Packs to become voluntary. | In a report published in June 2008, the former head of the OFT, Sir Bryan Carsberg, called for more regulation of the industry, and for Home Information Packs to become voluntary. |
| However, the cost of greater regulation in an industry under pressure from a moribund market could be fought against by agents. | However, the cost of greater regulation in an industry under pressure from a moribund market could be fought against by agents. |
| The OFT report will offer various recommendations that might require new legislation if they are not automatically adopted by the industry. | The OFT report will offer various recommendations that might require new legislation if they are not automatically adopted by the industry. |
| The study has also looked at the question of fees for services provided to buyers such as referrals for mortgages, surveys, legal advice and other services. | The study has also looked at the question of fees for services provided to buyers such as referrals for mortgages, surveys, legal advice and other services. |
| It has considered whether agents are open about these fees to customers, whether people are at risk of being overcharged, and whether these customers shop around or negotiate on charges for these services. | It has considered whether agents are open about these fees to customers, whether people are at risk of being overcharged, and whether these customers shop around or negotiate on charges for these services. |
| Mark Mclaren, of the consumers' association Which?, said: "We have long thought that the industry works more in the interest of property professionals and the consumer is forgotten about." | Mark Mclaren, of the consumers' association Which?, said: "We have long thought that the industry works more in the interest of property professionals and the consumer is forgotten about." |
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