Referral fees for estate agents could be back in the sights of industry regulators.
It was reported last week that the National Trading Standards Estate and Letting Agency Team (NTSELAT) has investigated cases where home sellers could be missing out on best offers because agents are favouring buyers who use their mortgage, legal or surveyor services.
James Munro, head of NTSELAT, told the Daily Telegraph: “We’ve seen commissions of 50% of the price, which is just ridiculous really. In some cases, the consumer’s getting no benefit from them.”
Munro suggested there may be offers for a property that are lower than others but that person is using an agent’s connected services and “mysteriously the higher offer just gets lost on the system.”
He said cases were detected by buyers who had offers declined, checked Land Registry data and noticed a lower offer had been accepted.
It is unclear what evidence there is that these buyers used an agent’s services but Munro said this is hard to police due to a lack of resources and no requirements for referral fees to be disclosed.
Not everybody fully believed the assessment.
Veteran agency executive John Durrant said on LinkedIn: “Is this going on? Am I naive in thinking agents aren’t that stupid?"
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A potential buyer worried about such a situation can simply send a letter to the property in question, giving details of the offer made to the agent. The seller will then be fully informed.
Lower offer can be accepted for a number of reasons but professional estate agents are unlikely to "lose" offers. Dodgy estate agents perhaps may - This yet another reason why professional agents want RoPA.
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