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74/08 17 June 2008
The OFT has today launched a market study into property management services for common and shared residential property in Scotland.
Residents in tenements and other collective residential properties in Scotland use property managers, known as factors, to manage common and shared property - for example roofs, staircases, entrances and gardens.
The study will consider issues such as how much choice and information is available to homeowners, how property managers are selected, the quality and costs of the services provided, how homeowners can effectively manage services and whether homeowners have access to redress when things go wrong.
The market study follows evidence submitted to the OFT by the Scottish Consumer Council (SCC), which highlighted potential consumer harm in this area.
The study will report back by the end of the year and will involve gathering and analysing evidence from homeowners, suppliers operating in the sector, and other key parties as well as co-operation with the Scottish Government and the SCC.
Heather Clayton, OFT Senior Director of Infrastructure, 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.'
Douglas Sinclair, Chair of the Scottish Consumer Council, said:
'The SCC has expressed concerns about the current system of Scottish property factoring and welcomes the OFT's announcement today. We look forward to working with the OFT as it looks in more detail at this important area for Scottish consumers.'
The OFT will be contacting key parties directly and other interested parties can submit written views to:
Scottish property management market study
Office of Fair Trading
2-6 Salisbury Square
London EC4Y 8JX
Further information can be found in the market study section of this website.
1. The work of property managers in Scotland usually includes organising repairs, maintenance and improvements and the administration of common buildings insurance. Property management services are provided by the private sector, local authorities and registered social landlords. The focus of the study is on property management services provided to the common owners of a property. Services provided to individual property owners such as residential letting services are excluded from the remit of the study, as is commercial property management.
2. In 2004, the Scottish Parliament passed the Tenements (Scotland) Act as part of a programme of property law reform to ensure that all tenements have a scheme for the management and maintenance of properties.
3. Scottish property management services are distinct from England and Wales as there is no leasehold system in Scotland and are subject to other historical and legal differences. In contrast to Scotland, most flats in England and Wales are owned on a leasehold basis, where the leasehold owner of the flat has a long term lease from the freeholder.
4. OFT market studies are carried out under section 5 of the Enterprise Act 2002 (EA02) which allows a market-wide consideration of both competition and consumer issues.
5. The Office of Fair Trading opened its office in Scotland last March to strengthen further OFT links with Scottish businesses, consumers, other enforcement agencies and policy makers. The OFT has a permanent representative in Scotland, Kyla Brand, and an office in Walker Street in the centre of Edinburgh.
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