Indeed, as private rental prices rose 1.3% in the year to March 2021, while house prices increased by 9.9% in the same period, it is no surprise that the industry is considered to be in robust health. However, there remain some longstanding structural issues within the industry that require some attention if real estate professionals are to capitalise in any meaningful, sustainable way. One particular issue is the breadth of industry bodies offering qualifications and accreditations.
Do they benefit the industry?
As agents, in particular, are free to operate with minimal regulation, owing in part to a soft-touch approach by successive governments in response to the sustained success of the market, there are a number of questions to be asked of those organisations which offer courses and training schemes to lend legitimacy to an agency or individual. For instance, why are there so many?
Professionals may engage or associate with, to name a few, The Royal Institution of Chartered Surveyors (RICS), the assessment of professional competence (APC), and the Institute of Residential Property Management (IRPM). With such a breadth of bodies offering accreditation, it can be difficult to ascertain the purpose of each.
Furthermore, it must be explored whether these truly hold value, taking in public awareness and trust in such schemes, and where they fail to shield professionals from broader criticisms levelled towards the industry. Finally, the question stands as to whether some or all, of these accreditations, should be made compulsory.
Regrettably, it is difficult to draw a broad consensus on this. In July 2019, the Regulation of Property Agents (RoPA) working group, an advisory body tasked with developing a new regulatory structure to increase professional standards within the industry, released a report exploring the terse relationship between licensing, accreditation and regulation in the property sector.
One of the more stark assessments raised through this was the voluntary nature of accreditation courses for both sales and lettings agents. Accordingly, discussion of reform or regulatory overhaul must explore both the value of these qualifications to the industry as a whole; and why professionals seek out non-compulsory accreditations to benefit their own development.
Valuable and lucrative for professionals
There is no question that there is tremendous value in seeking out accreditation for real estate professionals themselves. Undertaking courses by recognised leading bodies, such as RICS, is becoming an increasingly crucial factor in attracting clients, whether they be investors, buyers, sellers or tenants. As such, an outward symbol of a professional’s credibility and reliability holds intrinsic and lucrative worth in a sector that is stained with distrust and a reputation for opaque practices.
In the absence of robust regulation, professionals could see value in pursuing opportunities to demonstrate these qualities through a globally recognised professional designation. For instance, becoming a Member or Fellow of the Royal Institution of Chartered Surveyors (MRICS or FRICS).
Beyond the simple accreditation of courses, RICS also establishes guiding principles and standards which its members must comply with. Arguably, this is a healthier and more transparent system of checks and balances within the industry than deferring to bodies such as The Property Ombudsman, which primarily responds reactively to poor practical standards, where RICS is positioned to incentivise professionals proactively to perform appropriately. It enforces minimum requirements for professional liability insurance and professional development plans while taking an active role in scrutinising compliance with their standards.
Within the University of Manchester’s MSc Real Estate, we engage directly with the industry to ensure the courses are relevant to the ongoing and evolving practicalities of the sector – through this work, it is clear that accreditations and qualifications make real estate professionals better equipped to provide a high-quality service, and greatly enhance their future development opportunities.
With society beginning to re-emerge from the pandemic towards the planned 19 July “freedom day”, we are likely to see a cooling effect in many of the industries that have experienced a boom in activity under these conditions – it will be no surprise if the spike in demand for property begins to plateau in turn. Further, the ending of lockdowns may cause shifts in consumer demand observed over the past year, such as the increased buying and renting activity in rural areas to revert back in favour of pre-pandemic trends.
Meanwhile, as the Stamp Duty Land Tax holiday continues to taper off towards the end of this year, it is anticipated that there will be a quieter period for the industry as those who are looking to make property investments in the short term will certainly rush to complete before the deadline.
While the UK property market, inexorable as it often seems, is never likely to fall into a lull, professionals would be well-advised to use any time at hand to reflect on the pandemic and where their skills were placed under particular strain. Certainly, as we move towards the establishment of new regulation, the merits of such accreditation for the sector as a whole will be debated in full; though this should only further encourage professionals to undertake such courses to hone their ability to continue to adapt to evolving and unexpected circumstances.
