Online letting agents have been gaining popularity in the UK as they offer landlords an efficient way to find tenants and manage rental properties. However, with the increasing trend, comes a number of legal disputes and lawsuits between online letting agents.

One of the most notable cases was the lawsuit filed by Purplebricks against Emoov in 2018. Purplebricks alleged that Emoov had misled investors by providing false information about the size and success of its business. The lawsuit was settled out of court, emphasizing the importance of transparency and honesty in business dealings to attract investment.

If you need a lawyer in the United Kingdom, see our lawyer listing service.

Competition Appeal Tribunal

Another lawsuit was filed in 2019 by OpenRent against Purplebricks for engaging in anti-competitive practices by offering discounted fees to landlords who used its services exclusively. The case was heard by the Competition Appeal Tribunal, which ruled in favour of Purplebricks, stating that it did not harm competition in the online letting agent market.

Upad also filed a lawsuit in 2019 against Zoopla for failing to provide the agreed level of service in breach of their contract. Zoopla agreed to pay an undisclosed sum to settle the case, highlighting the importance of clear contracts and service-level agreements in business relationships.

In 2020, Easyroommate filed a lawsuit against SpareRoom, alleging that the latter had engaged in anti-competitive practices by offering discounts to users who posted their ads exclusively on the SpareRoom platform, harming its business and violating UK competition law. The Competition Appeal Tribunal ruled in favour of SpareRoom, stating that it did not harm competition in the flatshare market.

Anti-competitive practices

Similarly, No Agent filed a lawsuit against Purplebricks in 2020 for engaging in anti-competitive practices by offering discounted fees to landlords who used its services exclusively, violating UK competition law. Purplebricks settled the case out of court, emphasizing the importance of fair competition in the online letting agent market.

These cases showcase the importance of business ethics, clear contracts, and fair competition in the online letting agent market. As the market continues to evolve, it is vital for companies to adhere to these principles to maintain customer trust and prevent legal disputes.

Statistics show that the UK online letting agent market is expected to grow at a CAGR of 14.2% from 2021 to 2028. The market was valued at £1.4 billion in 2020 and is projected to reach £3.7 billion by 2028. With such potential growth, companies must prioritize ethical practices to avoid legal disputes and foster long-term success.

Online Letting Agent Industry Laws in the UK

The online letting agent industry in the UK is subject to various laws and regulations that aim to safeguard the interests of both landlords and tenants. The regulations are designed to ensure that the rental market functions efficiently and fairly.

Online letting agents must comply with the Consumer Protection from Unfair Trading Regulations 2008, which prohibit them from engaging in deceptive or unfair practices that may cause harm to consumers. This includes providing misleading information, withholding important information, or utilizing aggressive marketing tactics to gain business.

The Competition Act 1998 also applies to online letting agents. This legislation prohibits companies from engaging in anti-competitive practices that could undermine competition and limit consumer choice. Online letting agents cannot collaborate with other agents to establish prices or form exclusive arrangements that restrict customer options.

Additionally, there are specific laws and regulations that apply to the online letting agent industry, such as the Tenant Fees Act 2019. This legislation regulates the fees that agents can charge to tenants, limiting the amount that can be charged for referencing, tenancy agreements, and holding deposits.

Housing and Planning Act

The Housing and Planning Act 2016 is another important legislation that aims to enhance the quality of rental accommodation in the UK. The legislation introduces civil penalties for agents and landlords who do not adhere to legal obligations, such as gas safety checks or maintaining properties free of hazards.

Agents are also bound to comply with the General Data Protection Regulation, which enforces strict rules on the collection, storage, and use of personal data from tenants and landlords. Agents must seek approval from individuals to use their data, keep it secure, and use it only for legitimate purposes.

Furthermore, online letting agents must comply with industry-specific regulations, including registering with a redress scheme that handles complaints from tenants and landlords. They must also be a part of a Client Money Protection scheme, which safeguards the funds of tenants and landlords if the agent misuses them.

Online Letting Agent Lawsuits

Agents must adhere to the Property Ombudsman Code of Practice, which outlines ethical and professional standards for the industry. This includes requirements around advertising, transparency, and complaints handling.

The online letting agent industry in the UK is projected to increase by a compound annual growth rate of 14.2% from 2021 to 2028. The market value was £1.4 billion in 2020 and is anticipated to reach £3.7 billion by 2028. With such a lucrative market, agents must comply with the rules and regulations to avoid legal challenges and maintain their clients’ trust.

Online letting agents in the UK must adhere to various laws and regulations, including those related to consumer protection, competition, fees, standards, data protection, and industry-specific regulations. It is crucial for agents to be mindful of these regulations to avoid legal issues and maintain the trust of their clients.

We hope you found this guide on online letting agent lawsuits in the UK useful.

Legal Battles in the Online Letting Agent Industry

RELATED POSTS