Complaints to The Property Ombudsman in the first half of 2025 are running more than 50% higher than the same period in 2024, according to Chief Ombudsman Lesley Horton. The surge is driven by heightened consumer awareness of rights under the Renters' Rights Act, easier access to legal information, and widespread use of AI tools to draft formal grievances. For letting agents and property managers, that translates to a material increase in the probability of adjudication, longer case timelines, and higher costs to prepare rebuttals—even where complaints lack substantive merit.
The operational consequence is immediate. Agents must now assume that routine tenancy disputes or sales disagreements may escalate into multi-page, legally referenced complaints that demand expert review. That shifts the cost equation for early settlement and forces a reassessment of complaint-handling resources, documentation standards, and frontline training. It also raises questions about whether current professional indemnity premiums and redress scheme membership fees reflect the new risk profile.
What AI changes about complaint preparation
TPO reports that complaints are now "professionally presented, supported by references to legislation and accompanied by extensive correspondence." Horton acknowledges that AI has made it easier for consumers to articulate legitimate concerns, but also warns that technology "can produce complaints that appear persuasive while overlooking important facts or misunderstanding the law."
The practical impact for agents is threefold. First, a well-formatted complaint triggers the same internal escalation and review process as a legally sound one, consuming time regardless of merit. Second, adjudicators must now spend longer unpicking AI-generated legal references to establish whether the underlying claim is valid. Third, agents face pressure to respond at the same level of sophistication, which often means instructing solicitors or compliance consultants earlier in the process.
TPO has not disclosed what proportion of complaints are AI-generated, nor whether upheld rates have changed. That gap matters. If most AI-drafted complaints are dismissed, the cost burden falls disproportionately on agents and the redress scheme itself, with no corresponding improvement in sector standards. If upheld rates are rising, the story is different—but no data has been published to confirm that.
The cost question no one is answering
Horton states plainly that meeting demand requires "investing in skilled adjudicators, robust quality assurance, improved digital systems and processes," and that this work is "expensive." The next question is who pays. TPO is one of three government-approved redress schemes and operates on a membership and case-fee model. If adjudication costs rise materially due to complaint volume and complexity, those costs will be passed to member agents through higher fees, higher case charges, or both.
No fee change has been announced, but agents should review their redress cost assumptions for the current financial year. If TPO publishes full-year 2025 data showing sustained volume growth, expect a fee consultation in early 2026. Agents with high case volumes or multiple branch registrations should model the impact of a 20–30% fee increase now, before budget planning closes.
There is also a commercial question for the redress model itself. If AI enables complainants to escalate disputes at negligible cost whilst agents must resource expert responses, the system risks becoming asymmetric. Other regulated sectors have introduced triage filters or cost-recovery mechanisms for unmeritorious complaints. Whether TPO or government considers similar measures is unclear, but the current trajectory suggests the question will be forced.
What good complaint handling now costs
The immediate operational response is to reduce the probability that a complaint reaches formal adjudication. That means investing in frontline resolution capability, earlier legal review, and documentation practices that withstand ombudsman scrutiny.
Agents should audit current complaint-handling workflows against three tests. First, whether initial client communications are logged in a tamper-evident system with timestamps and version control—AI-drafted complaints often hinge on disputed conversations, and weak CRM audit trails are a liability. Second, whether staff have documented authority levels for settlement offers, refunds, or goodwill gestures, so that disputes can be closed before escalation without repeated referrals. Third, whether complaint acknowledgement and Stage 1 response templates reference the specific consumer rights legislation now cited by complainants, including the Renters' Rights Act and updated Tenant Fees Act guidance.
Some proptech vendors are positioning AI-assisted complaint management tools as a defensive play. The commercial opportunity is real if the product can demonstrate evidential audit trails that satisfy ombudsman adjudicators. Agents evaluating these tools should ask for case studies showing how the system has supported successful defences at adjudication, not just faster response times. The test is whether the tool reduces the cost of a defended case, not whether it speeds up a process that still requires legal review.