New rules will force companies to be more transparent on the price of conveyancing

Over recent years, the issue of transparency of price of conveyancing has been growing in importance, at least with regard to the private sector.

While this is arguably to be welcomed in many respects, it is not without its complications as can be seen with regards to the new rules regarding transparency in the price of conveyancing and the reaction to them.

The new rules in brief

In short, from 6th December 2018, conveyancers licenced by the Council for Licensed Conveyancers (CLC) have been obligated to provide basic details of their prices, service and quality on their websites and/or in other formats if required. As a minimum, they will need to publish their hourly rates plus guidelines on timescales and any additional costs and fees which may be charged on top of the basic hourly rate.

The recommended best practice is to have an online calculator with the ability to provide a realistic estimate without requiring the customer to leave their contact details in order to receive a quote. They must also provide details of their staff members’ experience and qualifications.

The rationale for their introduction

It’s impossible to dispute that certain members of the property industry have done a lot of damage to its public image. Even though the stereotypical rogue estate agent and their equally dodgy associates only constitute a very small percentage of property professionals, they take up a very large percentage of the publicity related to the property market and while it’s easy to criticize the media for misrepresentation, it has to be acknowledged that the misrepresentation is the portrayal (or implication) of the level of abuse rather than the fact that abuse does occur.

One particular form of abuse has been estate agents passing on customers to conveyancers with whom they have connections in return for a commission (either to the company or direct into the estate agent’s pocket). The new rules aim to make it easier for customers to see how much they can expect to pay for conveyancing if they go direct and hence, in theory, make it harder for commissions to be hidden amongst standard fees.

The reaction to their introduction

There was no sign of these new rules being greeted enthusiastically by the public at large (which has quite probably not even noticed their introduction) or by conveyancers themselves, who have been quick to point out that there are many factors which can influence the price and timescale of the conveyancing process, not least of which being the efficiency of the other party’s conveyancer, over which they have no control. Some conveyancers fear that the new rules will create a “race to the bottom” as high quality firms feel under pressure to cut prices in order to compete with online rivals because customers do not understand the benefit of paying extra for a higher level of service. While this is a reasonable concern, it is also a reasonable to argue that conveyancers as a whole need to do a better job of educating the public about what they actually do so that customers do understand why it can be very advantageous to pay extra for an expert conveyancer rather than going for the cheapest option.

Kindly shared by Indlu Estate Agents