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Housing Ombudsman says residents suffer from being stuck in the middle between social landlords and managing agents

The Housing Ombudsman has published a Spotlight report on landlord’s engagement with private freeholders and managing agents.

In the foreword to the report, Ombudsman Richard Blakeway says that there is “a culture clash between regulated and arguably unregulated parts of the housing market”, with “many social landlords facing poor standards of practice amongst private managing agents” and “it is the resident who experiences the unfairness of being stuck in the middle”.

The report draws on 62 cases involving managing agents and private freeholders between November 2020 and December 2021, accounting for 2.3% of all cases considered by the Ombudsman in that period:

  • The three highest categories of complaint were property condition (29.5%), complaints handling (19.9%) and charges (13.9%)
  • 64.5% of the cases resulted in findings of maladministration, compared to 45% for cases of all types
  • Reasonable redress had been offered in 9.7% of cases where something had gone wrong, compared to 10.6% for cases of all types and
  • The Ombudsman ordered compensation of £20,727.71 to be paid across the 62 cases.

The report looks at two key strategic issues:

  • Risk in relation to statutory and contractual obligations and
  • Prevention and due diligence.

The report also looks at a number of areas of operational learning:

  • Owning the relationship
  • Understanding roles and relationships
  • Working relationship with the managing agent
  • Effective response
  • Action plans and effective monitoring
  • Service charges
  • Care with standard form agreements and
  • Escalation.

In a section on looking forward, the report focusses on:

  • Two tier services
  • Collaborative working and
  • Sector-wide collaboration.

Overall the report makes 14 recommendations – four for the sector, one for local government, and nine for landlord senior management.

The report also says that “Boards and governing bodies should ensure they are informed” and should ask some specific questions of their organisations:

  • How exposed are we in relation to risks around meeting our statutory or contractual obligations?
  • What compromises are we prepared to make, if any, in providing homes without complete autonomy to act?
  • How robust is our due diligence in this area?
  • How clear are we on our roles and responsibilities? Do we have a common understanding between ourselves, managing agents, freeholders and residents? and
  • What steps can we take to improve performance?