The OFT is worried about referral fees or “kick backs” that most “traditional” Estate Agents get from suppliers of conveyancing services and HIPs. The payments work to the detriment of consumers……Of course, along with other trickery they also enable Estate Agents to make money without selling houses. But who pays the price and how does it work? Here’s some idea of the additional income Estate Agents can generate.
“Sign up fee”(you pay for the privilege of simply signing up) £200.00 Referral fee from HIP supplier £200.00 Conveyancing referral fee £125.00 All adding up to a cool £525.00
Not bad but the opportunities don’t end there. Many agents point purchasers in the direction of the agent’s “preferred” conveyancer. That’ll be another £125.00 Then there’s commission on mortgages £ lots!
Could this explain why some agents are marketing properties at 2007 prices. Over priced to sell but, hey, why bother when you can charge for adverts £plenty when the client gets fed up there’s a “withdrawal fee” £100.00
Who pays for all this? We’ll leave it to you to figure out. Is there an alternative?