Labour MP's concerns about estate agency practices
The Labour MP and shadow Consumer Minister Stella Creasy has spoken out about some estate agents taking advantage of the current property demand to charge extra fees to both buyers and sellers.
Her comments have come as the government proposes to move responsibility for the England and Wales real estate industry to the Powys and Anglesey Council Trading Standards.
Creasy opposes the change, saying: ‘With the terms and conditions of contracts for buying and selling houses causing increasing concern, now is not the time to turn a blind eye to these problems.’
She cites new evidence from the London housing market showing that Estate Agents are: ‘introducing new contracts which involve charging buyers a fee to be introduced to a property. This means they have to offer a lower price for a property as they have to cover this cost as well as the purchase price. Consequently sellers could get less money for their property despite also paying for the estate agent’s service.
Ms Creasy went on to say that: ‘The only people who do well out of these kinds of ‘sealed bid’ deals are the agents who get a nice fat fee from both the buyer and the seller.’
After reporting this practise to the Property Ombudsman, they called it ‘an emerging commercial practise.’ which could mean it will spread across the country.
Fearing the practise of double charging may become widespread, Ms. Creasy is unwilling to wait and see if it becomes an endemic, instead calling for: ‘tougher Ombudsman services that are able to act when new problems occur.’
The Labour MP went on to express her disappointment in the government’s weak position on consumer protection, saying:
‘It is problems like these that make me disappointed that the Government is pressing ahead with plans to give the oversight of all estate agents in England and Wales to the Powys County Council Trading Standards and isn’t reforming the provision of Ombudsman services to give consumers a uniform complaints process.
Leading Labour members in opposition to the move, Ms. Creasy went on to explain: ‘It is estimated these kinds of sharp practices cost consumers £6 billion a year. Yet the Government’s plans in the Consumer Rights Bill will do little to tackle many of the scams and fees like this that account for this sum.’