A letting agent has been ordered to pay £6,490 to a landlord after failing to transfer rent payments over a two-year period, according to a case published by The Property Ombudsman.
The landlord, identified as Marie, complained that her letting agent consistently failed to forward rent transfers received from tenants throughout 2023 and 2024. In some months, rent was transferred late, whilst in four months during 2024, no rent was transferred at all.
Evidence and investigation
Marie submitted a spreadsheet documenting the overdue payments, showing continued late transfers across multiple months. For the four months in 2024 where no rent was passed on, she provided bank statements from the tenants confirming full payment of £1,550 per month had been made to the agent.
The letting agent failed to provide any explanation or evidence that the funds had been transferred to Marie, nor any justification for withholding them, such as deductions for repairs or fees. Documentation confirmed the letting agent was entitled to retain a 5% management fee of £77.50 per month before forwarding the remaining balance.
The Property Ombudsman found that the letting agent owed Marie £5,890 in unpaid rent, which should have been transferred promptly in accordance with The Property Ombudsman Code of Practice. The Ombudsman also noted that the letting agent did not cooperate with requests for a response to the complaint or provide its branch file.
Financial impact
The Ombudsman upheld the complaint and awarded £6,490 in total: £5,890 for rent not passed on and £600 in compensation. The compensation reflected the aggravation and financial strain caused by the failure to transfer rent.
Marie relied on the rental income to meet mortgage obligations, and the delays placed her in a vulnerable financial position. The situation was exacerbated by the letting agent’s lack of communication and failure to resolve the matter.
The case highlights the importance of compliance with industry codes of practice regarding the timely transfer of rental income to landlords, particularly where landlords depend on that income to service mortgage debt.
