The National Trading Standards has issued fresh guidance for UK estate agents that include referral fees within their operations.
Drafted in response to a request by the government, the NTS Estate Agency Team, NAEA Propertymark, the Property Ombudsman, Property Redress Scheme, the Guild of Property Professionals and RICS worked together to produce the new guidance which, says the NTS, has been designed specifically to improve transparency.
It states that complete referral fee details – prices, involved parties, retainer value, and other specifics – must be disclosed, and that not doing so “may render an estate agency liable for criminal prosecution.”
Compliance with the guidance will be monitored over the next 12 months, the agency adds, before it will report to government ministers with its results.
The NTS Estate Agency Team’s James Munro says: “It is important for customers to be aware of any referral fees that an estate agent is receiving for recommending a service such as conveyancing, legal services or other connected service, so that they can make an informed decision about whether to take up the offer or shop around for a better deal.
“I would like to thank the professional bodies and redress schemes for their support in developing this guidance and would urge estate agents to comply with the guidance as soon as possible.”
NAEA Propertymark chief executive Mark Hayward adds: “We have long called for greater clarity and transparency on referral fees.
“It is essential that if you are referred for financial or legal services by your estate agent, you understand that they are receiving a commission, and how much this is. The guidance released today is a triumph for consumers and an important move in improving the house buying and selling process.”