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legal requirements to open an estate agency UK

What are the legal requirements for opening an estate agency in the UK?

Strictly speaking there are no legal requirements to open an estate agency in the UK. However, depending on the scope of your estate agency services, you will need to understand the relevant laws and industry regulations to ensure that you are compliant.

Who regulates the estate agents industry?

You should know that the regulatory body for the estate agency industry across the UK is the National Trading Standards Estate Agency Team (NTSEAT). This body keeps an eye on the relevant estate and letting agency legislation and its enforcement. It deals with situations in which a person is unfit to engage in estate agency work. It approves and oversees the UK's consumer redress schemes, among other activities.

Who regulates estate agents?

Who will regulate your estate agency will depend on the scope of your agency activities and where your agency is located. 

However, all estate agents in the UK, irrespective of their range of services, must be familiar with and follow the Estate Agents Act 1979.

Legal requirements to open and run a UK estate agency

Estate agents in the UK are not required by law to be licensed or qualified. However, the landscape of estate & letting agency regulations in the UK is quite varied and the bigger your agency is, the more you’ll have to worry about.

Residential agents in the UK (sales only)

Estate agents who engage in residential work have to belong to an approved redress scheme. There are two: 

  • The Property Ombudsman (TPO) scheme
  • The Property Redress Scheme

These schemes exist to give consumers the platform to make a formal complaint about an estate agent. Both schemes have the authority to resolve complaints if consumers can’t get anywhere with their estate agents.

Belonging to one of these schemes comes with certain conditions that every residential estate will have to follow.

Lettings agents in the UK

The private rental sector regulations are more complex because housing falls under the remit of the various local governments.


In England, anyone can set up a lettings agency without any prior experience or specific qualifications. However, if you decide to offer lettings, you’ll eventually need to catch up with some 150 pieces of law that affect this industry. In any case, you must:

  • register with a Government-approved independent redress scheme
  • protect tenancy deposits through a Government-approved scheme
  • register with a Government-approved Client Money Protection (CMP) scheme


Letting agents working or managing property in Scotland must:

  •  understand the Letting Agent Code of Practice
  •  meet the minimum training requirements in order to join the Scottish Letting Agent Register.

Since October 2018, it has been a criminal offence to carry out letting agency work if an agent is not on the Scottish register.


In Wales matters are again a bit more complicated. Everyone in Wales who lets or manages rental properties must be suitably trained and licensed.

If you undertake work on behalf of private landlords. you are legally required to:

  • register yourself and let properties with Rent Smart Wales

You must meet minimum training criteria as well:

  • have Client Money Protection (CMP)
  • hold professional indemnity insurance
  • belong to a redress scheme
  • provide all of their landlord and property details

Northern Ireland

There are no regulations at this moment in time.

Commercial estate agents

If you stick to commercial properties only and do not belong to any of the industry bodies, you only need to take into account the wider legal considerations. 

On the other hand if you decide to join RICS (Royal Institution of Chartered Surveyors), you will need to follow a certain set of professional standards to keep your membership and therefore enjoy the benefits of belonging to this scheme.

Wider legal considerations for estate agents

Certain general laws are also a concern to estate agents and as a business owner, you will need to make sure you understand your obligations andd have processes in place to be compliant.


Estate agents collect a lot of personal and financial information about their clients. As such, safeguarding that information is crucial. Estate agencies must comply with the General Data Protection Regulation (GDPR) when carrying out these activities. 

Make sure you understand this act, as this is often the subject of legal claims against against estate agents. Typical claims revolve around:

  • Not obtaining explicit consent from an individual before processing or sharing their information
  • Failing to implement appropriate security measures to prevent a data breach.

Failure to comply with GDPR can result in significant fines and reputational damage.

Anti-Money Laundering (AML) Regulations

According to UK law, estate agents must conduct Anti-Money Laundering (AML) checks in accordance with regulations and guidelines established by HM Revenue & Customs (HMRC). 

These checks include identifying the origin of funds utilised for property transactions and verifying the identities of their clients. Should an estate agent have suspicions regarding potential money laundering activities by a client, they are obligated to report such concerns to the National Crime Agency.

Whilst you are not expected to prevent all attempts to launder money, you’ll need to demonstrate that you have in place robust procedures and processes.


Among the conditions set by the regulators is adequate estate agency insurance. Professional indemnity insurance for estate agents is a must and has to be in place before the estate or letting agency starts its activities. 

However, public liability insurance is another essential cover given that estate and letting agents deal with members of the public and clients’ valuable properties.

In today’s digital day and age, cyber insurance has become a must as well for businesses dealing with their clients’ sensitive data. Hacking and data breaches are not reserved just for the big brands. Smaller businesses are often easier targets.

In the UK, employers' liability insurance is a legal requirement for anyone who works under your control and supervision, whether paid or not. That includes employees, freelancers, temps, volunteers, and helpers.

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