The New Ombudsman Scheme — Agent Requirements
The New Ombudsman Scheme — Agent Requirements
Quick Reference
Essential Points for Letting Agents:
- Phase Two Implementation (Late 2026): A new Private Rented Sector (PRS) Landlord Ombudsman Service will be introduced alongside the PRS Database
- Landlord Membership Required: All landlords must be members of the ombudsman scheme when marketing properties for let and must remain members for a reasonable period after ceasing to be a landlord
- Tenant Complaint Rights: Current, prospective, and former tenants can complain about landlord actions, inactions, or behaviours causing harm or inconvenience
- Agent Responsibilities: Letting agents must ensure their landlord clients are compliant with ombudsman membership requirements
- Increased Demand: The "Renters' Rights effect" has already driven a 58% increase in complaints (November 2025–February 2026 vs. previous year)
Overview
The Renters' Rights Act 2025 introduces a mandatory Private Rented Sector (PRS) Landlord Ombudsman Service as part of Phase Two reforms, expected in late 2026. This represents a fundamental shift in dispute resolution for the private rental sector, creating a formal redress mechanism for tenants and establishing new compliance obligations for landlords and their agents.
The ombudsman scheme will provide independent dispute resolution for tenant complaints, reducing the burden on courts and offering faster, more accessible remedies for rental disputes. For letting agents, this means ensuring landlord clients understand and comply with membership requirements, and adapting business processes to support this new regulatory framework.
Key Changes
Mandatory Ombudsman Membership
When it applies: From late 2026 (Phase Two implementation)
All landlords of assured tenancies in the private rented sector must be members of the designated ombudsman scheme. Key requirements include:
- Membership timing: Landlords must be members when a property is marketed for letting
- Ongoing membership: Landlords must remain members for a "reasonable amount of time" after ceasing to be a landlord
- Penalties: Landlords could face penalties for marketing or letting properties without proper ombudsman membership
Who Can Complain
The ombudsman service will accept complaints from:
- Current tenants: During active tenancies
- Prospective tenants: During the pre-letting and marketing period
- Former tenants: After a tenancy has ended (within the reasonable membership period)
This broad scope recognises that issues can arise at any stage of the rental process.
Scope of Complaints
The ombudsman will consider complaints regarding:
- Actions, inactions, or behaviours of landlords
- Matters that have caused harm or inconvenience to tenants
- Individual circumstances of each complaint (the ombudsman retains discretion)
Important: The specific types of complaints are not defined in the Act itself, allowing the ombudsman flexibility to consider cases on their merits.
Ombudsman Appointment
The government will designate or approve an ombudsman scheme through "the most appropriate route" to provide the best service for tenants and landlords. The administrator will be appointed as soon as possible after Phase Two provisions commence.
What This Means for Agents
Compliance Responsibilities
As a letting agent, you have a duty to ensure your landlord clients comply with ombudsman membership requirements:
- Client onboarding: Verify ombudsman membership before marketing properties
- Portfolio management: Maintain records of landlord membership status and renewal dates
- Marketing compliance: Do not market properties for landlords without valid ombudsman membership
- Exit procedures: Advise landlords on maintaining membership for a reasonable period after selling or ceasing lettings
Increased Complaint Volume
The Property Ombudsman reported a 58% increase in complaints between November 2025 and February 2026 compared to the previous year—the "Renters' Rights effect." This trend indicates:
- Greater tenant awareness of their rights
- Higher expectations for dispute resolution
- Increased scrutiny of landlord and agent practices
- More proactive tenant engagement with redress mechanisms
Business Process Implications
Agents should anticipate:
- More formal complaint handling procedures
- Increased documentation requirements
- Potential involvement in ombudsman investigations
- Need for clear audit trails of landlord-tenant communications
- Enhanced record-keeping for pre-letting activities
Professional Standards
The ombudsman scheme complements existing agent obligations. Agents registered with schemes like The Property Ombudsman already understand redress processes, but the landlord ombudsman creates a parallel system specifically for landlord-tenant disputes.
Practical Steps
Immediate Actions (Now)
- Review current landlord database: Identify all landlords in your portfolio and prepare for membership verification requirements
- Update CRM systems: Create fields to track landlord ombudsman membership status and renewal dates
- Develop compliance procedures: Establish processes for verifying membership before marketing properties
- Staff training: Ensure all team members understand the new requirements and their role in compliance
Before Phase Two Implementation (Late 2026)
- Client communication: Inform all landlord clients about the upcoming ombudsman membership requirement
- Marketing procedures: Update property marketing checklists to include ombudsman membership verification
- Terms of business: Review and update agency agreements to reflect ombudsman compliance obligations
- Documentation systems: Ensure robust record-keeping for all stages of the letting process (pre-letting, tenancy, post-tenancy)
Ongoing Compliance
- Regular audits: Conduct periodic reviews of landlord ombudsman membership status
- Renewal tracking: Implement automated reminders for membership renewals
- Complaint monitoring: Track complaint trends to identify potential issues early
- Portfolio reviews: When landlords exit the market, advise on maintaining membership for the required period
Integration with Other Phase Two Changes
The ombudsman scheme will be introduced alongside the Private Rented Sector Database, which requires all landlords to register themselves and their properties. Agents should:
- Coordinate compliance for both requirements
- Develop integrated onboarding processes
- Consider how database registration and ombudsman membership interact
- Prepare for potential penalties affecting both systems
Frequently Asked Questions
Q: When exactly will the ombudsman scheme become mandatory?
A: Phase Two implementation is scheduled for late 2026. The government will announce the specific commencement date with sufficient notice for the sector to prepare.
Q: Which ombudsman organisation will administer the scheme?
A: The government has not yet announced which organisation will be designated. The administrator will be appointed "as soon as possible" after Phase Two provisions commence, following a selection process to ensure the best service for tenants and landlords.
Q: Are letting agents required to be members of the landlord ombudsman?
A: The legislation requires landlord membership. However, agents should already be members of an agent redress scheme (such as The Property Ombudsman or Property Redress Scheme) under existing regulations. The landlord ombudsman is a separate requirement for property owners.
Q: What happens if a landlord refuses to join the ombudsman scheme?
A: Landlords who market or let properties without required ombudsman membership could face penalties. As an agent, you should not market properties for non-compliant landlords, as this could expose your business to regulatory risk.
Q: How long must landlords remain members after selling their last property?
A: The Act requires membership for a "reasonable amount of time" after ceasing to be a landlord. Specific timeframes will be clarified in secondary legislation or ombudsman scheme rules before Phase Two implementation.
Q: Can tenants complain about letting agent actions to the landlord ombudsman?
A: The landlord ombudsman addresses complaints about landlord actions. Complaints about agent conduct should be directed to the agent's own redress scheme. However, agents may be involved in ombudsman investigations concerning landlord complaints.
Q: What types of complaints will the ombudsman handle?
A: The ombudsman will consider complaints about landlord actions, inactions, or behaviours causing harm or inconvenience. The Act deliberately does not specify complaint types, giving the ombudsman discretion to consider individual circumstances.
Q: Will there be costs associated with landlord ombudsman membership?
A: Membership fees and structures have not yet been announced. These details will be confirmed when the ombudsman administrator is appointed and the scheme is formally established.
Q: How should agents prepare their systems for tracking ombudsman compliance?
A: Review your CRM and property management systems now to add fields for ombudsman membership status, membership numbers, and renewal dates. Integrate these checks into your property onboarding and marketing workflows. Consider how this data will interact with PRS Database registration information.
Q: What should agents do if a complaint is made against their landlord client?
A: Cooperate fully with ombudsman investigations, providing requested documentation and information promptly. Maintain detailed records of all landlord-tenant interactions to support fair resolution. Consider how your agency agreement addresses your role in complaint situations.
Additional Resources
- Propertymark Renters' Rights Act Toolkit: Comprehensive guides for letting agents navigating the legislation
- The Property Ombudsman: Updates on scheme implementation and requirements (www.tpos.co.uk)
- Government Implementation Roadmap: Official timeline and guidance for all phases of the Act
- Propertymark webinars: Regular training sessions on operational readiness and compliance
This help sheet is based on the Renters' Rights Act 2025, which received Royal Assent on 27 October 2025. Phase One reforms take effect on 1 May 2026, with Phase Two (including the ombudsman scheme) expected in late 2026. Always refer to the latest government guidance and consult legal professionals for specific compliance questions.
