The OFT has today launched a consultation on draft guidance which aims to help professionals in the private rented sector, including letting agents and landlords, to comply with the law.
The OFT's draft guidance seeks to clarify how the law applies to the lettings market. It identifies trading practices that could breach legislation, such as not giving sufficient information to tenants about what fees they will have to pay, or making misleading statements about a property.
The draft guidance sets out the OFT's views about how the legislation might apply at each step of the lettings process: from when lettings professionals first advertise their services, to the interactions they have with tenants prior to moving into a property, through to when a tenancy agreement comes to an end.
Demand in the private rented sector in England has grown in recent years. In 1999 around 10 per cent of households were rented privately and this figure has risen to around 17 per cent in 2011/12, with the number of households renting privately overtaking the number in the social rented sector.
Cavendish Elithorn, Executive Director at the OFT, said:
'The private rented sector is vitally important to millions of people, whether they are students, young professionals or families. Rental contracts can be the largest financial commitment some people have and letting agent fees can be hundreds of pounds.
'Our earlier report into the lettings market found that both tenants and landlords were concerned about the clarity of communication from agents including about fees and charges and poor service.
'Traders should always provide full disclosure of relevant information upfront, including a clear statement of the costs that will be incurred over the course of the rental. This guidance should ensure that businesses enable people to make decisions based on full information about the property and the agreement they are entering into, when they are looking to rent.'
This draft guidance follows the OFT's Lettings Market report which found that there was a need for clear guidance on how current legislation applies to lettings professionals.
The OFT welcomes comment from lettings professionals, tenants and other interested parties on the draft guidance. The consultation will close on 10 December 2013. A copy of the draft guidance can be downloaded from the consultation page.