A likely ban on estate agency referral fees has taken a step further after it was revealed yesterday that a report is to be submitted this month to Ministers about the practice.
James Munro, Head of the National Trading Standards Estate Agency and Lettings Team (NTSELAT), told a session at yesterday’s Council for Licenced Conveyancers annual conference that his colleagues had concluded their investigation into how transparent agents are being about their referral fees with customers.
This report will then be considered by Ministers and, Munro said, a decision will then be taken by them whether to regulate further.
In May last year The Property Ombudsman (TPO) updated its Codes of Practice on referral fees after consulting with 44 different organisations about them to help ‘agents understand their responsibilities and reduce the potential for consumer detriment to occur’.
As The Negotiator reported, the changes included requiring agents to be more transparent about referral fees but also sales fees in order to prevent the likelihood of ‘dual fees’ being charged. Agents were also urged to better explain how tenancy deposit products and other insurance-based products work.
Two months before the TPO update, NTSELAT warned agents to put their house in order and be more honest with clients about referral fees or face a potential ban and prosecutions, and that they were in the ‘last chance saloon’ on the matter.
“The disclosure must be made in a way which is clear, intelligible and unambiguous and have no lesser prominence in documentation than other important terms, conditions, or information,” NTSEALT’s briefing document said at the time.