Referral Fees – CA highlights need for disclosure
The Conveyancing Association’s (CA) Director of Delivery, Beth Rudolf, has recently shared her thoughts on the launch of the survey on estate agent referral fees.
Launched last week, the survey aiming to assess the use of the fees was launched by the National Trading Standards Estate Agency Team (NTSEAT).
Supported by the Property Ombudsman and Property Redress Scheme, the survey forms part of the government’s exploration into how it can improve the buying and selling process for consumers, following last year’s Call for Evidence of the same title.
Commenting on the use of the fees within the industry and the initiatives the CA are currently pursuing to improve the current situation, Beth said:
“The CA recognise that referral arrangements, where transparent and reasonable, are a useful tool in driving up standards within the conveyancing industry and enabling innovation. However, where these fees are not disclosed to home movers there is real concern.
“We have been working on various projects with National Trading Standards Estate Agency Team and are pleased to see that they are now looking at ways to ensure that everyone receiving or paying referral fees are operating on a level playing field.
“Referral fees fall under Consumer Protection from Unfair Trading Regulations, being a material factor in a consumer’s decision to take a service. We would also like to see NTSEAT resourced to provide effective guidance on CPR disclosure more widely, and enforcement of the regulations in respect of providing information upfront to potential buyers on their intended use and enjoyment of the property, as this will reduce fall throughs and also the timescales in the conveyancing transaction. Our home mover survey indicated there is a 98% failure rate on the compliance with CPRs.
“The CA, through the Home Buying and Selling Group, are working on developing disclosure forms to achieve this and NTSEAT will be reviewing these forms with the hope that they will set them at the minimum required information to be provided.”
Open until 2 July, the survey can be accessed here.