Are Property Management Companies Regulated?

Are Property Management Companies Regulated in England?

If you own a rental property or live in a block of flats, you might assume that the company managing your building must be tightly regulated. After all, property management involves handling tenants’ money, organising repairs, and ensuring buildings meet safety standards.

Surprisingly, property management companies in the UK are not currently regulated by law in the same way as, for example, estate agents or letting agents.

Here’s what you need to know about how regulation works and what protections are in place for landlords, leaseholders, and tenants.

What Is a Property Management Company?

A property management company oversees the day-to-day running of a property on behalf of a landlord, freeholder, or residents’ management company.

Their responsibilities typically include:

• Collecting rent or service charges

• Organising repairs, maintenance, and safety checks

• Managing contractors and suppliers

• Handling complaints and tenant issues

• Ensuring legal compliance (for example, fire and building safety rules)

  
  

These companies play a crucial role in maintaining standards and ensuring that homes and communal areas are safe and well managed, which makes the question of regulation even more important.

Are Property Management Companies Regulated by Law?

At present, there are no overarching government regulator or licensing system specifically for property management companies in England.

That means anyone can technically set up a property management company without formal qualifications or government approval. Although most reputable firms voluntarily join professional bodies to demonstrate their competence and integrity.

However, certain activities within property management are covered by existing laws and rules, including:

• Client Money Protection (CMP): If the company holds clients’ money (like rent or service charges), it must belong to a government-approved CMP scheme.

• Data Protection: Property managers must comply with GDPR when handling tenants’ and owners’ personal data.

• Health and Safety Legislation: They must ensure buildings meet fire, gas, and electrical safety requirements.

• Right to Manage and Leasehold Law: They must follow the Landlord and Tenant Act 1985 and other regulations governing service charges and leaseholder rights.

  
  

So while property management companies themselves aren’t formally regulated as an industry, they do operate within a legal framework.

Voluntary Regulation and Industry Bodies

Reputable property management firms usually join a professional body, which provides codes of conduct, training, and dispute resolution services.

The main organisations include:

• ARMA (Association of Residential Managing Agents) – sets professional standards for block management.

• IRPM (Institute of Residential Property Management) – focuses on individual qualifications and training for property managers.

• RICS (Royal Institution of Chartered Surveyors) – regulates chartered surveyors who offer property management services under a strict code of practice.

• The Property Ombudsman (TPO) or Property Redress Scheme (PRS) – handles complaints from clients and leaseholders.

  
  

Membership of these organisations isn’t mandatory, but it’s one of the best ways to judge whether a property management company operates professionally and ethically.

Plans for Future Regulation

The government has recognised that the lack of regulation leaves gaps in accountability.

In 2019, an independent Regulation of Property Agents (RoPA) report recommended creating a new regulatory framework for letting agents, estate agents, and property managers.

Proposals included:

• A new regulator for the sector

• Mandatory licensing and qualifications for property managers

• A statutory code of practice

  
  

Although implementation has been delayed, the government has signalled continued interest in improving standards, particularly around leasehold reform and building safety following the Grenfell Tower tragedy.

How to Check if a Property Management Company Is Trustworthy

If you’re choosing a property management company, it’s worth carrying out some quick checks:

• Are they a member of ARMA, IRPM, or RICS?

• Do they have Client Money Protection?

• Are they part of a redress scheme (TPO or PRS)?

• Do they have professional indemnity insurance?

• Do they provide transparent fee structures and regular financial reporting?

These indicators can help you separate reputable companies from less professional operators.

Whilst property management companies aren’t yet legally regulated in the UK, many operate to high professional standards through voluntary membership schemes. For landlords, freeholders, and leaseholders, it’s essential to work with a company that’s transparent, accredited, and committed to good practice.

With government pressure for reform increasing, full regulation of the sector may only be a matter of time.