CLC roundtable highlights how pandemic forced conveyancing firms to put property tech at top of agenda
Conveyancing firms that adopted new technology during the pandemic would have taken years to do so otherwise, a Council for Licensed Conveyancers (CLC) roundtable has heard.
The restrictions imposed on businesses forced many into fast-tracking their plans to introduce software which better connected them with clients and other parties involved in the home-buying process.
John Reynolds, chief operating officer at Coadjute, which connects software platforms used across the property market, said:
“This immediate shift to lockdown and fully online sparked a tremendous amount of digitisation.
“The pace of services opening up and joining up advanced five years in five months, to the extent that even competing platforms connected up to provide a shared view of a transaction’s data to their users.”
Rob Houghton, the chief executive of Reallymoving, which owns The Law Superstore, added that more lawyers and consumers now understand that they never have to meet.
Rob Houghton added:
“For lawyers, it is significantly increasing the total addressable market.
“Many more firms are increasing their market footprint because they are happy to pitch to people on the other side of the country.”
The roundtable heard how the huge market demand translated into an average 44% rise in conveyancing fees at its peak. They have since fallen back a little and the question is whether that will continue.
It has been a long time since conveyancers have put their prices up rather than down. Beth Rudolf, director of delivery at the Conveyancing Association, reckoned that the “chase to the bottom caused half of the problems that we have seen”.
Beth Rudolf explained:
“How can you afford technology when you are not making a profit? It has to be a good thing that the market has risen, and that people can be properly resourced. “Particularly with transaction times of 18 weeks, your pipeline turn and the cash coming in has been really tricky.”
Despite the natural competition that exists between businesses, participants said it was the industry working together that had enabled it to cope with the unprecedented demands of the last 12-18 months.
Even smaller firms that would usually do next to no conveyancing work played a vital role, according to Mark Montgomery, chief strategy officer at Simplify, the UK’s largest conveyancing group.
Mark Montgomery said:
“Some 40% of the market is delivered by the 5,000 smallest firms, and the smallest of those are the equivalent of the oil-fired power station that gets switched on once a year.
“We would not have got through without firms that normally do almost no conveyancing jumping in and doing more. Whatever we do or think about in terms of technology adoption, we have to recognise that, if you exclude those firms from the market, all our aspirations for transaction speed go out the window if everybody is too busy and there is no flex in the system to deal with that excess demand.”
The stress placed on the sector was acknowledged, with reports of conveyancers working at 150% of their usual capacity as they struggled to work around the restrictions and staff shortages due to Covid.
Coming out of the stamp duty holiday, Andrew Lloyd, managing director of property data company Search Acumen, said:
“The industry as a whole is exhausted – the supply chain has been in exactly the same position as conveyancers. Whether it is local authorities who are being asked to provide due diligence information or the other third parties involved in providing signing services, all of it has been stretched to its absolute limit.”
A survey by Teal Legal last Christmas found that 50% of conveyancers wanted to leave the profession, such was the level of stress, director Sally Holdway noted.
But despite the period of great change just experienced, it was warned that no firm could afford to be complacent when it came to technology.
Andrew Lloyd added:
“Tech investment is permanent. It is a line item on your costs on an annual basis, and you have to, if you do not understand it, hire somebody who does. Otherwise, you will be the small law firm that in five years does not exist.”
Stephen Ward, director of strategy and external relations at the CLC, encouraged firms who had questions about tech development to get in touch.
Stephen Ward said:
“We are entering a period in which we might see large-scale and rapid change, or certainly the opportunity for that, and the CLC wants to support that.
“Innovation is not an end in itself, but we see major potential for it to improve consumer protection and how the housing market functions.”
The roundtable took place before the recent cyber-security incident at the Simplify group. A more detailed write-up of the event can be found here.
Kindly shared by Council for Licensed Conveyancers (CLC)
Main photo courtesy of Pixabay
