The UK Government has announced plans to “professionalise” the real estate sector, requiring all agents to hold a qualification.
On Sunday, Housing & Communities Secretary Sajid Javid announced the introduction of extra protections for buyers, as the government looks to crack down on “rogue” real estate agents.
As it stands, anyone can practice as a real estate agent, with an estimated 20,000 active real estate agent businesses across the UK.
According to the newly announced plans, agents will also be required to reveal the fees they receive for referrals to solicitors, surveyors and mortgage brokers, in a bid to encourage greater transparency across the sector.
In addition, the government said it plans to tackle “gazumping”. This refers to when a seller backs out of a sale, in an attempt to secure a higher bid from the buyer.
Buyers and sellers will now be asked to sign lock-in agreements, with the risk of incurring costs, if they back out of a deal without justification.
Mr Javid said the government plans aim at making the housing market “cheaper, faster and less stressful” for buyers.
Mr Javid commented: “We want to help everyone have a good quality home they can afford, and improving the process of buying and selling is part of delivering that.
“Buying a home is one of life’s largest investments, so if it goes wrong it can be costly.
“That’s why we’re determined to take action to make the process cheaper, faster and less stressful.
“This can help save people money and time so they can focus on what matters – finding their dream home. I want to hear from the industry on what more we can do to tackle this issue.”
According to figures, “gazumping” tactics by real estate agents contribute to over a quarter of house sales falling apart every year.
.@SajidJavid has announced plans to improve the home buying and selling process by cracking down on rogue estate agents and putting consumers back in control https://t.co/JfCdUkU3MU pic.twitter.com/NXlMtnDHrY
— Ministry of Housing, Communities and Local Govt (@mhclg) April 8, 2018
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This comes amid a year of difficulty for the UK housing market, as Brexit uncertainty continues to stunt house price growth and the sector more generally.
In particular, the housing market in London has stagnated, with house prices across the capital falling more than 15 per cent in the last 12 months.
Despite an increasingly subdued housing market, UK house prices in the first three months of the year were up 2.7 per cent, according to the latest house price index from Halifax.
This marked an increase on February’s figures, up from the 1.8 per cent growth recorded a month earlier.