The comprehensive study will consider the relationships between estate agents and other related parties including mortgage brokers and surveyors.
It will focus on competition on price and quality between service providers, with particular attention paid to estate agents.
Striking the right balance between consumer protection and innovation in the housing market will also be addressed.
The study will cover the whole of the UK, although it also aims to acknowledges the inherent differences with the Scottish housing market.
Heather Clayton, senior director of infrastructure at the OFT, says: “With the economic downturn, we need to ensure that consumers receive a good service when buying or selling a home, from a market that is competitive, innovative and well-functioning.
“We have had constructive discussions on the scope of this study with interested parties from across central and devolved government, consumer groups and the industry.
“This means we are starting the study with a clear understanding of the key issues.”