Landlords are being advised not to assume that the appointment of a letting agent automatically transfers responsibility for adhering to rental regulations. This warning follows significant tenancy reforms introduced by the Renters’ Rights Act.
New tenancy rules, which came into effect in England on 1 May, have increased the compliance burden for landlords and agents. Penalties for certain breaches can reach up to £7,000, while more serious or repeated offences may result in fines of up to £40,000 as an alternative to prosecution.
Paul Endacott of 1st Avenue highlighted that landlords need to closely monitor how their agents manage compliance. He stated that if an agent makes an error, the landlord could still be held responsible for non-compliance, which carries severe consequences.
While government guidance indicates that landlords can use agents to perform their duties and agents can also be liable for breaches, the specific legal obligation and circumstances determine liability. For example, for Right to Rent checks, if an agent accepts responsibility in writing, the civil penalty liability rests with the agent.
Mr Endacott emphasised that property management is increasingly becoming a compliance risk management role. He urged landlords to scrutinise their agents' procedures, noting that outsourcing the job does not automatically outsource the risk, and a weak managing agent now poses a financial risk.