Regulation of property factors on the horizon after centuries of imbalance in Scotland

A Bill to require Property Factors to comply with a statutory code of conduct and be registered has been published by Patricia Ferguson MSP. The Property Factors (Scotland) Bill, which has attracted cross-party support, will make it an offence for a property factor to operate without being registered, and will introduce an accessible form of alternative dispute resolution.

The legislation will lead to the establishment of a code of conduct setting minimum standards of practice expected of registered property factors, and will afford greater protection for homeowners from rogue factors.

The publication of the Bill follows several years of campaigning by Mike Dailly, Principal Solicitor at the Govan Law Centre, who has worked alongside the Maryhill MSP pushing for legislation to clean-up property factoring in Scotland. 

Commenting on the publication of the Bill Patricia Ferguson MSP said: "This is a milestone in the campaign to regulate property factors, and to protect homeowners from the unscrupulous practices of those factors that have brought the whole industry into disrepute".

"It is two and half years since I launched a consultation on my proposal to require the registration of factors, which showed overwhelming support for legislation. Hopes were raised when the Office of Fair Trading carried out a study into Scottish Property Factors, but then dashed when they only recommended a voluntary scheme despite concluding that the system is not working well".

"There was disappointment when the Scottish Government refused to legislate, favouring an industry-led voluntary accreditation scheme similar to that which has already failed homeowners. But the campaign was boosted when my proposal received the support of 45 MSPs from across the political divide to allow a Bill to be introduced, and when the whole Parliament supported a motion welcoming the progress towards legislation".

"The publication of my Bill is yet further progress towards legislation that will ensure better accountability of property managers for their standards and the services that they provide and I hope that it will continue to receive the support of my colleagues in the Scottish Parliament."

GLC's Mike Dailly said: "Property factors must be the only industry in Scotland who are virtually unlicensed and unregulated. When one third of your customers are unhappy with the service you provide it's time for a statutory solution. The Scottish Government are consulting on a voluntary accreditation scheme, but we've had self-regulation for centuries and it hasn't worked. The people of Scotland need a solution with legal teeth, and the Bill provides that solution in a fair and measured way".

"By introducing a formal requirement on all factors to be registered in a national register of property factors, the Bill would ensure that minimum standards of practice were adhered to across Scotland. Individual homeowners would be able to rely on those minimum standards in their day to day dealings with their property factor, and in an extreme case a bad factor could be de-registered to prevent them causing ongoing consumer detriment".

"Where a property factor failed to meet their contractual duty, or failed to reasonably adhere to the minimum standards, a homeowner would be entitled to take their dispute to a new tribunal called the 'homeowner housing committee'. There would be no need for a lawyer, and no legal expenses to worry about. The Bill gives the homeowner housing committee the power to ensure compliance with the contract and minimum standards, and where appropriate, require the factor to made a compensatory award or refund to the homeowner".

Full details of the Bill are available on the Scottish Parliament's website here.