Agent regulatory bodies explained

Estate and Letting Agent regulatory bodies explained

25 June 2016MeetMyAgent

When you call an estate agent or letting agent round to value your property, they may tell you they belong to a regulatory body such as TPO, NAEA, NALS, etc.

As an owner, do you know anything about these bodies? Does membership of these bodies help you in deciding which agent to choose? More importantly, should you care?

We explain in simple terms what the role of agent regulatory bodies are to give you a better understanding why you as a homeowner should take an interest in whether your agent belongs to any of them.


As you read this information, please keep in mind that only estate agents are required by law to be part of a government-approved redress scheme, while letting agents are not. This means that landlords cannot assume they will have a route to redress if things go wrong.

Depending on which body your agent belongs to, click the links below to jump to the relevant section and find out more about the work they do.

The Property Ombudsman (TPO)

TPO is one of two independent government-approved redress schemes and has two arms – one dealing with sales and the other with lettings. Agents must be members in order for the public to raise a complaint about them to the TPO, and membership currently stands at over 11,800 sales and 9,500 lettings offices.

TPO can make awards for compensation of up to £25,000 where it has found an agent has acted inappropriately and caused financial loss, aggravation, distress or inconvenience although the average award is less than £1,000. Complainants must seek to resolve disputes with the agent before escalating it to TPO.

From April 2012, all TPO members are covered for both sales and lettings. However, while it is a legal requirement for estate agents to be part of an approved redress scheme, note that the same requirement has not been extended to letting agents. This means that if your agent provides lettings only, you must check if they are part of a redress scheme.

More information on TPO Codes of Practice for both sales and lettings can be found at

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Ombudsman Services: Property

The Ombudsman Services: Property is the second of two government-approved redress schemes and can make awards of up to £25,000 in the event the agent has caused financial loss or distress, although the average award in 2011 was £900. Agents must be members and complainants must first follow the agents’ complaints procedure before referring the dispute to the Ombudsman.

Because letting agents, unlike estate agents, are not required by law to be part of a redress scheme, if you are renting through an agency who covers both sales and lettings you should always check that they are also covered for lettings if they display The Ombudsman Services logo.

The Ombudsman Services has other arms covering the communications and energy sectors as well as music copyright, so does not exclusively deal with property. While they do not publish their membership figures, the property arm seems to deal heavily with surveyors (being more in line with the Royal Institute of Chartered Surveyors than the agency trade bodies) and so the number of agent members is generally thought to be smaller than The Property Ombudsman.

More information of Ombudsman Services: Property can be found at

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National Association of Estate Agents (NAEA)

The NAEA is the leading UK estate agents’ association, with a membership of over 7,000 agents. Members are expected to uphold high levels of ethical and professional standards and must adhere to a strict code of conduct. NAEA can issue fines of up to £5,000 for each rule breached.

Consumers using a licensed NAEA member have the following guarantees:

  • The agency is covered by a client money protection scheme, meaning that client monies are insured against misappropriation by the agent
  • The agency has professional indemnity insurance, ensuring that consumers are financially covered  for claims relating to negligence, bad advice or mishandling of data
  • A route to redress should things go wrong due to mandatory membership of an independent redress scheme. There are two schemes available: The Property Ombudsman and Ombudsman Services: Property

NAEA also provides a range of courses and qualifications for estate agents to help improve knowledge and increase standards in the industry, and it is a requirement for members to complete at least 12 hours of continuing professional development.

Note that individual staff may have undertaken qualifications with NAEA and received the accreditations MNAEA and FNAEA (‘member of’ and ‘fellow of’, respectively).  However, the agency as a whole must be a member of NAEA for the above guarantees to apply.

In addition, an NAEA member agency may also provide a lettings service, but unless the firm also belongs to a lettings regulatory body (such as NAEA’s sister association ARLA), the above guarantess will not apply to its lettings arm.

More information on NAEA can be found at

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Royal Institute of Chartered Surveyors (RICS)

RICS has a history dating back to 1792 and was granted a royal charter by Queen Victoria in 1881. They are the leading global body of property professionals, incorporating the fields of land, property and construction. Their membership spans over 100,000 property professionals worldwide and much of RICS’ work is educational and policy based.

While the body is specifically aimed at chartered surveyors, you will often encounter RICS members who are chartered surveyors operating an agency business. Highly qualified professionals who must undertake a RICS-accredited university degree, consumers should expect a high level of knowledge and professionalism.

Members are governed by a strict code of conduct and there is a clear complaints procedure. Consumer protection is provided by way of client money protection schemes, indemnity insurance, and mandatory membership of an independent redress scheme – RICS is aligned in particular with Ombudsman Services: Property. RICS has on many occasions called for a single industry-wide compulsory redress scheme to cover both sales and lettings.

More information on RICS can be found at

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National Approved Lettings Scheme (NALS)

NALS is concerned with the lettings and property management sectors, and exists to give consumers reassurance they are dealing with an agent that:

  • belongs to client money protection schemes and has a designated client money account with their bank, so funds deposited with the agent are protected against misappropriation
  • has professional indemnity insurance covering clients for losses relating to their negligence
  • has a written complaints procedure and provides customers a route to redress when a resolution cannot be agreed through their internal procedures – either The Property Ombudsman (Lettings) or Ombudsman Services: Property

Unlike other regulatory bodies, NALS does not offer training or qualifications although it places a bigger emphasis on rigorous accounting standards. However NALS was the first regulator in the lettings industry to require its members to join a redress scheme. With letting agents not being required by law to offer a route to redress, this provides landlords using NALS members the peace of mind that there is somewhere to turn if things go wrong.

NALS also operates SAFE Agent, a new government-endorsed mark denoting firms that protect client funds in a client money protection scheme. To qualify for the SAFE Agent mark, firms must be regulated by a trade body (not just NALS) that requires them to be part of a client money protection scheme. MeetMyAgent was a supporting organisation of SAFE Agent Awareness Week – you can find out more at

More information on NALS can be found at

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Association of Residential Letting Agents (ARLA)

A sister association to NAEA, ARLA deals specifically with letting and management agents and has a membership of around 6,000. Using an ARLA member has the same guarantees as the NAEA – that the agency participates in a client money protection scheme, has professional indemnity insurance and offers a route to redress.

Particularly important is ARLA’s mandatory requirement for members to belong to an independent redress scheme – either The Property Ombudsman (Lettings) or Ombudsman Services: Property. As letting agencies are not required by law to belong to a redress scheme, this unfortunately means a few unscrupulous letting agencies are able to operate unpunished.

Lettings is a fast moving sector, with regulations changing fairly regularly, so it is important your agent is well-versed in current regulations to ensure that you as a landlord don’t fall foul of the law. ARLA members have access to a range of training resources and are required to complete at least 12 hours of continuing professional development each year.

Note that individual staff may have undertaken qualifications with ARLA and received the accreditations MARLA and FARLA (‘member of’ and ‘fellow of’, respectively). However, the agency as a whole must be a member of ARLA for the above guarantees to apply.

More information on ARLA can be found at  

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The UK Association of Letting Agents (UKALA)

While UKALA is not a regulatory body, we are drawing attention to it in this article due to its relationship with the National Landlords’ Association (NLA), the largest landlord’s association in the UK with over 20,000 registered landlords, and mydeposits, one of three government-backed tenancy deposit scheme.

As a trade association for lettings and property management agents, UKALA’s primary function is to promote its member agents, not to regulate them. However, it does provide its members access to a wide range of training and related services in conjunction with the NLA and mydeposits.

Members are expected to offer professional indemnity insurance and client money protection, but UKALA does not take disciplinary action against members who don’t adhere to its code of practice, except by termination of membership.

Note that while it asks its members to observe its code of practice (based on the ‘Code of Practice for Residential Letting Agents’ by The Property Ombudsman), there is no mandatory requirement to be part of a government redress scheme as with ARLA or NALS. This means you must separately check whether the agent offers a route to redress in case things go wrong.

More information on UKALA can be found at

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