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Consultation, Scotland: Property Factors

Wednesday 11 October 2017

Property Factors (also known as property management companies) have become increasingly common in recent years, especially for new build homes. But they are not always run as well as homeowners would like them to be.

This is why the Scottish Government has launched a consultation to look at revising the existing Statutory Code of Practice for registered property factors, which was first introduced in October 2012 and formed part of the Property Factors (Scotland) Act 2011. As well as a code of practice, the Act established a new statutory framework which property factors are obliged to abide by.

Broadly speaking, a property factor is responsible for managing common parts of land owned by two or more 'other persons', who have adjoining or neighbouring properties. 

The Homeowner Housing Panel (HOHP), which now forms part of the First-tier Tribunal, was also set up at the time of the Act to resolve disputes between disgruntled homeowners and their property factor in relation to the property factors’ statutory duties and compliance with the Property Factors' Code of Conduct. 

If the homeowner is successful the tribunal can issue a legally binding property factor enforcement order (PFEO) against the company, such as requiring action, providing information or making payment to the homeowner. 

Why is the Scottish Government looking at changing the existing Code of Practice?

When the Property Factors (Scotland) Act 2011 was passed, provision was made for a regular review of the Code of Practice, to ensure that it is still achieving its original objectives and striking the right balance between standards and duties placed on property factors.

In accordance with this provision, last year, Ministers began their first review of the code since its introduction; the findings from which form the basis of the consultation document. 

The consultation document cites recent annual reports from Homeowner Housing Panel (HOHP), (now part of the First Tier Tribunal) which provide evidence of dissatisfaction with the way some property factors communicate and handle complaints. 

What is the consultation looking at?

The consultation sets out to establish a revised statutory Code of Practice for registered property factors and seeks the views and evidence on five distinct parts:

  • Whether the original code has had an impact and led to improvements in the quality of factoring services
  • The introductory text, themes and specific requirements included in the draft revised code
  • Amending provisions of the Property Factors (Scotland) Act 2011, with the purpose of giving further effect to the draft 'revised' code
  • The impact on equality groups and costs to businesses
  • The impact of the wider 2011 Act and whether it has led to improvements in the regulation of property factors

Within these broader parts, the revised code addresses specific areas such as: the need to provide a Written Statement of Services, Authority to Act, Financial and Charging Arrangements, repairs and maintenance, communication, and how to end the agreement. Respondents are also asked whether they agree with the revised code, or would like to see elements amended. 

Respond to the consultation

ARLA Propertymark, and NAEA Propertymark members can also respond to Tim Douglas, Propertymark's Policy and Campaign Officer, or contact him if you'd like to discuss any aspect of the consultation. 

Property factors include, private businesses, local authorities and housing associations.