Referral fees have been described as a “hidden tax” on homebuying that must be banned.

The Conveyancing Task Force insisted that referral fees must end – despite them having provided a healthy additional form of income for many estate agents.

The task force is the latest group to call for an end to their existence, saying the fees have operated as an “unseen surcharge’ on homebuyers. The Law Society has also demanded an end to referral fees.

It described the fees as “an opaque commercial mechanism” that “quietly shapes” where consumers are directed for legal advice.

Conveyancing integrity

It claimed that the payments are exchanged “behind the scenes” between estate agents, panel managers, introducers and conveyancers – and that these payments have “distorted choice, compromised independence, and eroded trust in the integrity of the conveyancing process”.

Too many homebuyers are steered towards firms not because they offer excellence, but because they have paid for the introduction.”

It said the fees are not a neutral feature of the market, and that they incentivise recommendations based on commercial gain rather than client need.

“Too many homebuyers are steered towards firms not because they offer excellence, but because they have paid for the introduction,” it said.

Tougher safeguards

The Conveyancing Task Force recognises that, in reality, referral fees are deeply entrenched across the conveyancing market.

It believes that an immediate ban, however desirable in principle, risks destabilising firms and narrowing consumer access.

It said: “Referral fees must now be treated as inherently high‑risk commercial arrangements, subject to mandatory, significantly tougher safeguards and consistent regulatory enforcement.

“Firms must demonstrate that client interests, not commercial relationships, drive recommendations and instructions. Regulators must ensure that ethical duties are upheld in practice, not merely asserted in policy.

“This marks the beginning of a medium‑to‑long‑term transition. The expectation is clear that referral fees should progressively reduce and ultimately fall away as the market shifts towards models that reward quality, independence and public trust, not paid introductions.”