The Boomin portal, which incentivises agents to cross-sell and benefit from referral fees, is to receive advice on fee disclosure from Trading Standards in the coming weeks.
James Munro, the head of the National Trading Standards Estate and Letting Agent Team, has told a Propertymark webinar that he is seeing a demonstration of the Boomin model in the next two weeks, after which he will give advice on fees disclosure.
The Boomin business model and fees structure - disclosed yesterday on Estate Agent Today - emphasises that agents should be paying the portal less in terms of monthly charges than it receives from referral fees and new business generated by the portal itself.
Boomin has a two-stage fee structure - a base fee and a performance fee - and the portal itself says at least three parts of its offer to users (called Priorities, Property Playground and Matchmaker) can be revenue raising.
Boomin says: “At the end of each month, minimum revenue required [for the agent] must be achieved again before any performance fee is payable. Any performance fee due will be deducted from the revenue generated for the branch before remitting funds to the agent within 30 days of the funds being received into the Boomin bank account.”
Referral fees have been a hot potato for the industry in the past 18 months.
Last month the government welcomed a report from NTSELAT which recommended agents voluntarily disclose fees in a bid to improve transparency and ensure consumers felt confident in the services they receive.
The proposal follows a review into referral fees and their impact on buyers and sellers carried out by Trading Standards at the request of the Ministry for Housing, Communities and Local Government.
At yesterday’s webinar James Munro told attendees that the government would be taking another 12 months to assess how the industry was responding to the request - voluntary at this stage - to be more transparent.
He said that in theory existing CPRs - the Consumer Protection from Unfair Trading Regulations - made it legally binding for agents to disclose this referral fee information. However, the question for the government is whether to set out specific and new legislation to make it mandatory if agents fail to disclose.
Presentations to agents by Boomin strongly talk of a potential “lifetime revenue” and not just related to actual listings of properties for sale or let.
For example, its ‘Property Playground’ facility will allow prospective buyers or more casual visitors who do not intend to buy, to look at other options - different utilities, lifestyle and design supplies, landscaping and other ancillary services.
Individual buyers who like an accessory in an image or a service shown in a video will be able to purchase it, with a form of referral fee for the agent if that customer is a registered buyer.