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Westminster investigating ALMO for ex-council buy-back practices
Westminster Council’s trading standards team is investigating its own ALMO for the second time in six months, it has emerged.
The authority previously fined City West Homes £15,000 and listed it on the Greater London Authority’s database of rogue landlords and agents after another investigation last year.
City West Residential, a letting and estate agent set up by the ALMO in 2009, was found to have breached consumer rights laws by failing to display its new tenancy fees accurately on its website.
Westminster City Council would not confirm the nature of the second investigation, but Inside Housing understands it relates to the way City West Homes uses its estate agent to buy back ex-authority homes sold through Right to Buy.
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Freedom of Information Act responses from City West Homes suggest that it takes fees from the council for buying back Right to Buy homes, while selling leaseholders are also charged an estate agent fee.
City West Homes tells sellers that it is wholly owned by the council, but it is understood that it does not make clear that it receives a fee for acquiring the homes.
Section 21.2 of the Estate Agents Act 1979 forbids agents from entering into negotiations on properties in which they have a “personal interest” without disclosing “the nature and extent” of the interest.
City West Homes manages the borough’s stock of 21,000 homes, including leaseholds. It was the first ALMO to establish a letting agent.
A spokesperson for Westminster City Council said: “Our trading standards team are looking into a complaint regarding City West Residential, as we would do with any business.
“However, as this is ongoing we are not able to go into any details at this time.”
A spokesperson for City West Residential said: “We understand Westminster City Council trading standards are looking into a complaint regarding City West Residential.
“Although we don’t believe we have contravened trading standards or are in breach of the Estate Agents Act (1979) we will of course comply fully with any investigation.
“In the light of this enquiry we are also conducting a review of our own processes.”
