Complaints against letting agents have soared by 45% in less than a year, according to the Property Ombudsman.

Buy to let property disputes made up 49% of Ombudsman Christopher Hamer’s workload in 2009, compared with 28% in the previous year.

Better consumer awareness, more houses changing tenants due to recession and more letting agents voluntarily joining the redress scheme policed by the ombudsman were all quoted as factors contributing to the increase.

Mr Hamer urges whoever wins the general election to improve protection for consumers and property owners using letting agents.

He said: “This needs addressing swiftly. My message to any property owner or prospective tenant is to ensure that they use an agent who is a member of a recognised trade association or any agent who is a member of the Property Ombudsman scheme.”

Mr Hamer also said he felt that letting agents were not forced to belong to a redress scheme was an “alarming inconsistency”, although many letting agents have joined one voluntarily.

Overall, his report stated that letting agents have to “up their game” and treat property owners and tenants better.

During 2009, the Property Ombudsman dealt with 562 disputes, down from 799 in 2008. The average award to complainants was £339, down from £666 in the year.

The Property Ombudsman service is free for consumers with a complaint about an estate agent or letting agent belonging to the scheme.

Maximum compensation is up to £25,000, and the ombudsman’s decision is binding on agents who belong to the scheme, although consumers can reject his findings and pursue the matter through the courts.

A  letting agent that repeatedly failed to protect landlords’ and tenants’ monies has been ordered into liquidation in the High Court on grounds of public interest following a Government investigation.

The investigation by the Insolvency Service found that Foster Stone Limited repeatedly breached agreements with both landlords and tenants and failed to protect tenants’ deposits and landlords’ monies in relation to rent and administrative fees.  As a result numerous complaints were made resulting in 31 county court judgments against the company totaling £82,177.

The company’s business was primarily operated through a web site.  Visitors to the company’s trading address at Surrey Docks, London, found the premises seemingly unoccupied, although they were apparently watched by a security camera above the door.

The grounds for winding up were that the company:

• Failed to co-operate with the investigation

• Failed to deal with deposits received from tenants in accordance with an authorised scheme in accordance with the Housing Act 2004

• Made misleading statements on its website and purported “We feel sure that your experience with us will go a long way towards changing your perception of the property industry for the better”

• Failed to file accounts and annual returns

• Made unexplained payments and was insolvent

In ordering the company into liquidation, Mr Registrar Simmonds said that he was satisfied that the evidence before him, supported by the earlier appointment of a provisional liquidator by Mr Justice Sales, showed there was a strong case that the company should be wound up in the public interest.