Estate agents doing residential sales work anywhere in the UK, and letting agents in England, must by law belong to a government-approved redress scheme (Wales licenses letting agents through Rent Smart Wales and Scotland registers them separately - check the position where you operate) - either The Property Ombudsman (TPO) or the Property Redress Scheme - and trading without registering can lead to a penalty (gov.uk gives a fine of up to £5,000 for estate agents). See gov.uk: redress schemes for estate agents.
If your agency is a member of The Property Ombudsman (TPO), you are bound by its Code of Practice. The code sets out the standards of conduct expected of agents in their dealings with sellers, buyers, landlords, and tenants. Breaching the code can result in complaints, compensation awards, and - in serious cases - removal from the scheme. The exact maximum award the Ombudsman can direct is set by TPO and should be checked against the current figure on the TPO website.
This article summarises the key rules that most commonly arise in practice.
Transparency and Honesty
The code requires agents to act with integrity and to communicate clearly and honestly. This means:
- Providing clear written terms of business before entering into an agency agreement
- Disclosing all fees, charges, and commissions - including any referral fees you receive from third-party services such as mortgage brokers, conveyancers, or surveyors
- Not misleading buyers or tenants about the nature of the property, its features, or its price - omitting material information is itself an unfair commercial practice under the DMCC Act 2024, enforced by the CMA (gov.uk)
- Passing on all offers to the seller promptly and in writing, unless the seller has given written instructions not to receive offers below a certain level
Handling Offers
One of the most common areas of complaint is how agents handle offers. The code requires you to:
- Forward all offers to the seller promptly, accurately, and in writing
- Not discriminate against buyers who do not wish to use your recommended services (mortgage, solicitor, etc.)
- Confirm receipt of offers to the buyer
- Inform all prospective buyers of the existence of other offers (though not the amounts) when applicable
Referral Fees and Connected Services
Agents must disclose any financial interest in services they recommend. If you receive a referral fee for recommending a conveyancer, mortgage broker, or surveyor, you must tell the client in writing before they agree to use that service. The amount or basis of the referral fee must also be disclosed. This duty sits within the wider material-information regime now enforced by the CMA under the DMCC Act 2024 (gov.uk).
Client Money
If you hold client money (deposits, rent, etc.), the code requires you to:
- Hold it in a designated client account, separate from your business funds
- Have Client Money Protection (CMP) insurance in place
- Provide clear accounting to clients on request
Complaints Handling
Every TPO member must have a written in-house complaints procedure. When a complaint is received, you must:
- Acknowledge it promptly
- Investigate it thoroughly
- Provide a final response within the period set by the current TPO Code of Practice (check the timescale on the TPO website, as it may change)
- Inform the complainant of their right to escalate to TPO if they are not satisfied
Common Reasons for Complaints
- Failure to pass on offers
- Misleading property descriptions or photographs
- Hidden fees or undisclosed referral arrangements
- Poor communication during the sales process
- Failure to handle deposits correctly
- Not following agreed marketing instructions
Consequences of Breach
If TPO upholds a complaint, it can direct you to apologise, take specific remedial action, and pay compensation. Failure to comply with a TPO decision can result in removal from the scheme. Because membership of an approved redress scheme is a legal requirement for residential estate agency work under the Estate Agents Act 1979 and the redress-scheme rules (gov.uk), losing your scheme membership puts your ability to trade at risk - check your obligations against the current gov.uk and scheme guidance.
The full TPO Codes of Practice for Residential Estate Agents and for Residential Letting Agents are available on the TPO website. All agents should read the full code applicable to their business, not rely solely on summaries.
Last reviewed: 14 June 2026. This is general guidance, not legal advice - always check the current gov.uk and scheme guidance.