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Property management in Scotland in need of reform

The Office of Fair Trading report says that around 135,000 Scottish household rely on property management companies and that while the majority are happy around one in three are not.

And two thirds of those who had made a complaint about their property management firm were dissatisfied with the way their complaint was handled.

The report, Property managers in Scotland, a market study, points out that not only do many not understand their rights, many are unsure about the standard of service they should expect, and there is limited scope for redress when things go wrong.

Property owners in Scotland rarely switch their property manager and at the same time, there is little evidence of active competition between property management companies to attract business.

As a result of its findings, the OFT has recommended early implementation of a Scottish Government promoted self-regulatory scheme, with an independent complaints redress mechanism, to ensure better accountability of property managers for their standards.

If this fails, a statutory scheme should be introduced, and the development of an advice and mediation service by the Scottish Government – available to owners and managing agents – to help overcome the legal complexities and prevent the breakdown of arrangements.

In addition, the OFT report found similar problems in the market for land maintenance companies, with consumers experiencing particularly extreme barriers to switching land maintenance suppliers when ownership of open spaces had been transferred to private companies.

The OFT's recommendations have now been submitted to the Scottish Government which has agreed to respond within 90 days.

'This is a market that is not working well for many homeowners in Scotland. People often have little or no understanding about their rights, households rarely switch factors, suppliers do not seem to be actively competing with each other and the options for consumers when things go wrong are very limited. The OFT's recommendations for change should be to the benefit of many Scottish consumers,' said John Fingleton, OFT Chief Executive.