Industry self-regulation now moves centre-stage says PropTech chief

13 August 2020 | Renting

Industry self-regulation now moves centre-stage says PropTech chief

A leading PropTech figure says a political issue north of the border demonstrates the advantages of voluntary industry codes of practice over formal regulation. 

Neil Cobbold, UK chief sales officer at automated payment service PayProp, says the recent decision to scrap a Bill to introduce a rent cap in Scotland is a case in point. The Fair Rents (Scotland) Bill was withdrawn from the Scottish Parliament in July, just a few weeks after being introduced and before it could be debated.

Put forward by a Labour MSP, it intended to cap rent increases for private tenancies at no more than the annual Consumer Prices Index plus one per cent.

Private tenants would also have been given the right to apply for a ‘fair rent’ to be based on the condition and amenities of the property, determined by a rent officer or First-tier Tribunal no more than once in any 12-month period.

But the Bill was scrapped last month because of a shortage of time and resources in the current pandemic period, with the measure in any case unlikely to become law before next year’s Scottish elections.

“Rent controls are complex to introduce and deeply controversial among landlords and property professionals. Therefore, now may not be the best time to consider such far-reaching regulation as the market continues to recover from the unprecedented shock of the last few months” explains Cobbold.

And he believes the principle shows that, in England too, it’s just too difficult to bring in new legislation now – thus giving the industry itself an opportunity to act.

“The difficulty of bringing forward new property industry legislation makes the role of self-regulation that much more important” he adds.

“In contrast, initiatives like the ongoing Code of Practice Steering Group consultation, based on the recommendations of the Regulation of Property Agents report [in 2019] give property professionals a chance to agree new industry rules that are sensitive to challenging market conditions.”

Cobbold says that while COVID-19 could affect the plans for many pieces of legislation, property professionals should take the opportunity to make their voices heard.

“The consultation period will remain open until September 4 and I would encourage everyone involved in the industry to give their feedback” he says.

“With so many from the sector already getting involved, we can reasonably expect the final document to reflect our needs and concerns while ensuring that we continue to do our best for landlords, tenants and homebuyers” Cobbold concludes.

This post has originally been featured in Letting Agent Today.