Housing Minister Mark Prisk tabled the amendment in reaction to changes made to the Bill in the House of Lords, which would have given letting agents the same level of regulation as estate agents.
Instead the government proposes to oblige letting agents to belong to an approved redress scheme, or ombudsman, which will give landlords and tenants an avenue for dealing with complaints when they arise.
While the BPF feels this is a step in the right direction, it believes further action will be needed to remove all rogue letting agents from the sector.
Ian Fletcher, director of policy at the British Property Federation, said: “The Housing Minister has listened to the sector’s representations and reached the right conclusion. Clearly this is an eleventh-hour amendment to a Bill that is not housing in scope; as such there is a limit to what can be realistically achieved.
“Independent review of a complaint by an Ombudsman is good practice already pursued by many agents, and it is excellent that all tenants and landlords should now have access to such schemes.
“There are still issues left on the table, however, and we should not kid ourselves that this will expunge the sector of bad letting agents. For example, we will continue to campaign to have client money protection insurance extended so that money paid over by landlords and tenants to an agent is properly accounted for and not at risk.
“As is the case with regulation, government support and resource for its enforcement to ensure agents are not paying lip-service to it, will also be vital.”
The government stopped short of backing an amendment introduced in the House of Lords by Baroness Hayter which called for a change to the law to give the Office of Fair Trading, which regulates property sales, stronger powers to ban rogue letting agents.