Property managers under scrutiny

Factors manage shared areas in tenement buildings

The Office of Fair Trading (OFT) has launched an investigation into the service provided by Scotland's factors.

The moved followed concern that homeowners and tenants are being given a raw deal.

The OFT study will examine the quality and cost of factors, who manage shared areas such as roofs, stairwells and gardens in tenement buildings.

The report, to be completed later this year, will also look at the options open to residents when things go wrong.

The OFT will gather evidence from homeowners and suppliers operating in the sector.

The probe followed evidence submitted by the Scottish Consumer Council which highlighted "potential consumer harm".

'Positive outcomes'

SCC chair Douglas Sinclair said: "The SCC has expressed concerns about the current system of Scottish property factoring and welcomes the OFT's announcement.

"We look forward to working with the OFT as it looks in more detail at this important area for Scottish consumers."

OFT senior director of infrastructure Heather Clayton said: "This study will take a detailed look at Scottish property management services, consider how well they are working for homeowners, and take a view on any recommendations which might bring positive outcomes for consumers in Scotland."

There are some 330,000 owner-occupied flats in Scotland and a further 85,000 rented from private landlords.

Of these, the majority of residents are likely to be in a relationship with a property management company. Average administration charges paid to property managers are in the region of �100 per flat per year.

Mike Dailly, of Govan Law Centre, told a BBC Scotland investigation earlier this year that he was dealing with an increasing number of cases where people were being sued for thousands of pounds by factors.

He said much of the debt accrued because factors were charging them for reminders sent at a cost of more than �17 every five days.

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