By using this website, you agree to our use of cookies to enhance your experience.


Clampdown on referral fees: new Trading Standards guidance to be issued

It’s been revealed that the National Trading Standards Estate Agency Team is to deliver new guidelines to agents for referral fees next month.

There is no indication what the new guidelines will suggest but it is known that there will also be an updated code on the issue from The Property Ombudsman.

There will then be a review of the revised fees system in about a year’s time.


The announcement was made by junior housing minister Heather Wheeler this morning at the annual conference of the Council for Licensed Conveyancers.

Wheeler told delegates that home buyers should not choose their conveyancers by default, and that this initiative by NTSEAT should bring “excessive” referral fees to an end. “I’m concerned about the current lack of transparency” she told delegates.

Last week the Ministry of Housing, Communities and Local Government indicated that a government statement on the issue was likely “very soon” but no details were  given; in the past, there has been speculation that there could be an outright ban, at least on fees coming from the sale of new-build properties.

In recent days the conveyancing service When You Move has stated that 32 per cent of home buyers complete little or no research on conveyancers and so choose those recommended by estate agents involved in the transaction.

Last year, separate research conducted by polling group YouGov for the Council for Licensed Conveyancers - which has its annual conference today - found that 59 per cent of those who accepted estate agent advice and used a recommended conveyancer were unaware that a referral fee was probably paid to the estate agency.


Just this morning we carried here on Estate Agent Today a story about one of the largest estate agencies in the Midlands, Newton Fallowell, saying it had made a remarkable £5m in referral fees from its 20-year link with conveyancing firm Move with Us.

The family run agency operates out of 36 branches across the Midlands region and has 40,000 clients a year.

Its managing director Mark Newton says: “The current market place is a maelstrom of falling fees as competition from online agents bites and conveyancing now forms an essential part of our turnover. We have tried other solutions over the years, but no-one else offers the joined-up thinking we get from Move with Us. Not only does it create a very successful revenue stream to help in the very challenging market, it provides our customers with a marketing leading service.”

  • icon

    Eye watering cash bung sums mask the appalling conveyancing that is then given to the public. We spot it when we resell, over and over again. We see it when we interact as part of the conveyancing process, and when we come to exchange contracts and actually speak to some conveyancers, my heart sinks for the service standards out there,

    But I don't read the Government are going to regulate who can be a conveyancer....so at the moment, any law firm can promote the office cleaner and set them to work tomorrow as a conveyancer.

    It's a scandal.

  • Paul Singleton

    Vendors are sent documentation from MWU clearly stating that the agent involved will be paid an introducer fee but they don’t bother to read it. More legislation won’t force vendors to read.paperwork any more than they do now.
    How many times we go to properties on with other agents that the vendors have signed 20 week contracts and are blissfully unaware is incredible but again they don’t bother to read it prior to signing.

  • icon

    Hopefully this is a start. There is a very very long way to go in order to get the conveyancing process back into any semblance of order, where it was when I started work many years ago. No doubt vested interests with huge amounts to lose will lobby, and somewhere along the way the Government will back down somewhat.
    But for the professional, competent, decent Solicitors and Agents out there, and most importantly for the clients buying their dream house, let us hope that today is the first step towards an industrial revolution that makes the factories obselete and gives conveyancing back to those of us who actually enjoy the job and take a pride in what we do. Oh yes, and actually know what we are doing, that is always a useful qualification for doing this job, but one sadly in short supply these days.

  • icon

    Disruptive and existing business models that rely on this income could be in for a nasty shock. My guess is from the announcement above that NTSEAT will no longer allow a forced/ default choice of conveyancer such and will require a panel with, perhaps, more transparency over who receives what and how much, as IFAs' have to declare.

  • icon

    A ban on referral fees would be difficult to enforce - is it needed ?
    Stuart Forsdike
    PCS Legal


Please login to comment

MovePal MovePal MovePal
sign up