Estate agents should be forced to take exams to protect homebuyers

Estate agents should be forced to pass an exam before they are allowed to work in the business, a major report said today.

At present, anybody can start working as an estate agent without a single qualification to their name.

As a result, estate agents are one of the most reviled professions, with a reputation for misleading consumers, ripping them off and wasting their time.

Today's report, written by Sir Bryan Carsberg was commissioned by the three biggest industry bodies - the Royal Institution of Chartered Surveyors, the National Association of Estate Agents and the Association of Residential Letting Agents.

Experts said today it is 'crazy' that estate agents with no training and no professional qualifications can buy and sell people's home.

Sir Bryan, a former director general of the Office of Fair Trading, said buying a home is often 'the biggest financial transactions in a person's life.'

With homes selling for an average of £200,000, the cost to the consumer of an estate agent getting it wrong, or acting illegally, is enormous, he said.

He wants all estate agents to take an exam before they are allowed to work for even a single day in the controversial industry.

They would also have to take annual 'refresher' courses to make sure that they were fully up-to-date with any new rules and laws.

Existing estate agents would also need to take the new exam unless they can prove that they have the experience not to need to.

Peter Bolton King, chief executive of the National Association of Estate Agents, admitted today that the industry is 'far from perfect.'

He said there are 'one or two bad apples' who can infect the whole industry, which does have many reputable professionals.

He said: 'I talk around the world on the subject of estate agents' needing no professional qualification to work in Britain.

'People often just do not believe it.'

Just 4,100 of Britain's 30,000 estate agents, who work in sales rather than lettings, have passed the NAEA's exam which was set up five years ago.

The industry is so unregulated there are not even exact numbers about how many people are working as estate agents. The NAEA's 'best guess' is 30,000.

Today Sir Bryan said he worries that most people who meet estate agents wrongly assume that it is a regulated profession.

In fact, it is notorious for a few 'rogues', who can rip off homeowners and homebuyers.
He said: 'It is a complex situation - and people don't understand it.

'They go to an estate agent thinking that they are regulated when they are not.

'It seems to me important that there should be some basic qualification that the agent understands the industry satisfactorily.'

About 11,100 complaints were made to the Ombudsman for Estate Agent from disgruntled people last year, a 31 per cent increase on the previous year.

Horror stories include putting an over-inflated price tag on a home just to get the business, but slashing the price within a few weeks.

Other cases involve an estate agent failing to admit that they know the buyer, who may be their wife, cousin, best friend or even business partner.

They are meant to be acting for the seller to get the highest price, but they are actually trying to help their friend or family get the lowest price.

In a separate move, Sir Bryan said Home Information Packs should be scrapped and made voluntary.

Since December, everybody selling their home must pay for a HIP, but he said they 'impose a cost that does not bring with it any real benefit.'

HIPs were Labour's big idea for speeding up the homebuyer process, and contain everything needed to sell a home, such as local authority searches,  proof of ownership and a new 'green-rating'.

Today opposition parties seized on the latest attack on HIPs, which have been relentlessly criticised their controversial introduction last year.

Sir Bryan's report described HIPs as 'the worst of all worlds.'

Shadow Housing Minister, Grant Shapps, said: 'Experts and consumers now agree that HIPs are effectively dead, yet the government refuses to accept their inevitable demise.

'Labour has let down everyone on the property ladder in Britain today.'

Liberal Democrat Shadow Housing Minister, Lembit Öpik, said: 'The Government’s chaotic handling of HIPs has created confusion in the housing market at a time when red tape and delays are the last things the market needs.

'It’s time that the Government realised its HIP is broken.

'Ministers should focus on getting the housing market going again, instead of putting ludicrous obstacles between buyers and sellers.'