My Lords, I spoke on this in Grand Committee and I do not want to repeat either the points I made then or the many comments that have been made by noble Lords this afternoon. I want to make two or three additional points.
I have noticed in my home town of Watford a proliferation of letting agents, a constant change in their brand and marketing or moving address. Certainly, for the tenant, there is no clarity in the difference between an estate agent and a letting agent. The Government have argued that accepting this amendment complicates the landscape in this area. I think the exact opposite is true. I have two examples of tenants suffering problems with letting agents and one of landlords.
A typical prospective tenant might be a single mum who has found her way back into work. I happen to have a friend who was in this situation last year. The letting agency decided that it was going to demand of all single mothers with children, regardless of whether they had work and were able to show they had continuous employment, four months’ rent and, in addition, a guarantee from a male whose work they also wanted guaranteed. These are most extraordinary conditions.
One of the major problems is that many people who are desperately seeking rented accommodation would not know where to go. If you are struggling to find accommodation in your home town, to be able to go to Citizens Advice means that in reality you will lose the property. Certainly, in the south-east, lower cost rented property is at an absolute premium. This sort of behaviour, when there is no ombudsman and no code of conduct, is very difficult to police. I only know about this because of a personal contact.
More familiar to your Lordships’ House will be the example of students in a university town trying to find accommodation. If they have been lucky enough to have a year in halls, they often end up trying to find accommodation elsewhere. One of my children’s universities used to say: “Please find your accommodation through the university accommodation syndicate. If you
go outside, we cannot guarantee that you will not be ripped off by letting agents. In particular, many letting agents have a reputation for finding every reason under the sun not to return your deposit”. The fact that you have to warn students of this before they have even entered into a contract tells me that there is something wrong with the letting agency business.
Many landlords pay extra money for their agent to manage the day-to-day business, perhaps if they are away. I have had, again, anecdotal evidence from two landlords who have been away from their town—which is why they pay the extra percentage charge—and discovered the letting agent ringing them to ask them to clean the house between lets and to arrange for the plumber to call and all the other things that they had thought were included in the extra percentage charge that they were paying. The noble Baroness, Lady Hayter, referred to the Liberal Democrat paper that was passed by conference, Decent Homes for All, and my honourable friend Annette Brooke MP has also been fighting with EDMs and other comments in another place on this important issue. My party certainly believes that we need to regulate the letting area.
I will add one final point. The coalition agreement, rightly, seeks to reduce red tape. Not accepting this amendment allows the continuation of a red tape for a consumer and a tenant, simply because, at the moment, a tenant has to understand the difference between being with an estate agent and a letting agent and to understand that if they are with an unlicensed letting agent, instead of going to the ombudsman and taking redress through the code of practice, they may have to go Citizens Advice, a small claims court or trading standards. My 19 year-old son in his first foray at university would not have known where to start with that. If we can do what his university rightly tries to do in guiding the students and say, “You need to be assured that the people you are dealing with actually follow a code of conduct and there is an ombudsman to whom you can turn”, then we would have a much simpler system, which is free of red tape.
I am very grateful to the Minister for the meetings that have been held over the past few days and hope that we will be able to hear some progress when he informs the House of any further consideration.