An anonymous conveyancer has admitted increasing fees to deter buyers and sellers in the frenzied housing market during the stamp duty holiday.
The admission is reported in the Law Gazette, which runs a feature prompted by an Estate Agent Today story earlier this week.
The solicitor told the Law Gazette that: “Some firms have chosen to put fees up, some have decided that they will not do new build work - it is for each firm to manage the work load, especially in a boom as we have never seen before.”
The solicitor said that in the current boom, some estate agents are making sales before they have prepared the marketing material or conducted viewings.
The article was prompted by a leading agent’s comment on conveyancers’ fees, reported in Estate Agent Today on Monday.
Jeremy Leaf - principal of north London estate agency Jeremy Leaf & Co, and a former RICS residential faculty chair - says he has seen different solicitors quote £6,500 and £2,500 for what would appear to be the same work.
Of the higher charge, Leaf has now told the Law Gazette that the £6,500 conveyancing fee was double the normal charge from that company.
He tells the Law Gazette: “It is clear some conveyancers are working under extreme pressure to meet the deadline working their socks off whereas others are doubling their fees … If solicitors are overcharging, without justification, then bad word soon goes around. If they have no choice but to put charges up, they should explain why that’s the case as well as what their rates would revert to after this rush is over.”
He instead encourages conveyancers to admit they are charging higher fees now, and pledge to return to normal fees when the housing market returns to more regular levels of activity.
“Justify your fees, be transparent, say ‘This is just a one-off in order to meet an intense deadline and to pay our staff extra to work evenings and weekends to get the job done’” he urges.
You can see the full Law Gazette article here, and the EAT article with Jeremy Leaf’s original comments here.
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Good grief. What a non-story.
The natural law of supply and demand reigns supreme, just as it has done for hundreds of years.
So what if fees have been raised? Why shouldn't they?
Moving companies have done the same thing.
If a conveyancer wants half the clients at double the price then why not? Natural market forces dictate that if they've judged it correctly their plan will work.
If they've got it wrong they'll suffer.
If a conveyancer has tripled fees, with half the clients and is making a fortune then good on them. They've made an effort to read the market, judge supply & demand and capitalise.
All hail proper free market capitalism.
Good on them
Only very rarely do I, a conveyancer, agree with Mr Faizey’s comments. This is one such occasion. We now reject ‘new-build’ work, at any price, because we became fed up of the Aggressive Developers and the harassing attitudes of their attack dog style agents & sols, so terrified those agents/sols are of losing said developers’ lucre.
We’ve nudged prices up, generally, so to reduce demand and to reduce the sheer number of cases to a manageable level; our regulatory bodies have effectively instructed us to manage workload dependent upon our capacity to properly act for our clients.
What would be lovely is if half the clients leads to better service....
I suspect it has. The offer to completion timescales have, on average been shortened.
Which proves what I've said all along. It's not the system but the people implementing it.
I agree with some of your comments Matt but absolutely not the bit about the “people implementing the system". Part of the problem is (but not right now) low fees, and high volumes.
The sniping and bickering between conveyancers and agents is a silly and immature distraction. I just hope that once transaction numbers drop, conveyancers keep their fees at a fair level and take on the right amount of work to carry it out efficiently.
I also hope that if that happens, referral fees are not increased and legal employers reward their coal face fee earners correctly.
Referral Fees must be OUTLAWED coupled with the REGULATION of Estate Agency businesses with power to effect proper disciplinary sanctions upon the Owners of the Agencies.
Rob,
You're going tto need to explain then how it is that service levels for those moving over the last 2-3 months have risen so much.
Extended periods between exchange and comp is one thing, key release another.
Not too mention, and much more obviously that more completions are being achieved much quicker even with sensible timescales between ex & comp.
It's ironic that in a situation where backs are to thee wall across the entire sector all the horrible parts involving bad service are receding. Things are better, in this ridiculously overheated period than over years prior when it was half the volume.
Fees - well, the great get paid well in any sector and the bad struggle. The ratios tell the story.....
That's a simple fact of free market economics.
The public pay for quality where quality is desired and available. They will not pay well for low quality services or goods.
Pick any service within any sector. It holds true.
If a person, firm, company or PLC can't command the money it wants it can either blame the customers or ask why.
With the exception clearly in this instance of the conveyancer above. That person doesn't seem to be struggling.......
If only everything was really as black and white as you see things Matt.
Day off today, grandaughter sitting. A lovely distrction from listening to a well worn recording.
None so blind....
I do wish everyone would appreciate that people and businesses are doing what they can to survive.
It seems amazing that in a feast some businesses can starve by being bogged down with too much volume, staff struggling with mental illness, being unable to get on with the work for having to keep up with updates to third parties that distract from getting things done, feeling that the only option is to buy in more staff that ultimately puts them at risk of not being able to cover the wage bill if not enough transactions complete.... it goes on, but it is happening.
There still remains a viscous undertone that has to stop for the sake of everyones health and wellbeing.
There needs to be far more compassion and belief that people do care about getting the job done and are likely working far longer hours than are appreciated.
IF a business wishes to increase fees in the hopes of slowing down some demand, so what? This is not a new trend, it is sensible and has been happening for decades.
Agents are always asking about how they can increase their fees and market share. Cake and eat it.
This firm is asking for higher fees and less market share, so that they can survive. No one should frown on that and it should certainly not be sensationalised or cause for a heated discussion.
Agents and conveyancers need to have more open and honest discussions and build relationships built on trust and understanding of each others businesses, procedures, struggles and successes. Better collaboration will afford wins for both Agent and Conveyancer.
I really don't understand the fuss about this. It's basic supply and demand economics. If only more were brave enough to do this.
Exactly, anyone tried booking a holiday to Portugal, or centre parcs who have tripled their prices for this summer and even then you get limited, socially distanced use of the pool complex? Monopoly money either way. Fees for buyers started going up overnight in July last year as everyone in the supply chain looked to cash in on the activity and rightly so if their products/services are in demand. Any stamp duty saving was gobbled up long before house price inflation came into the equation.
How many of their staff see any of those additional fees??? Certainly in our office the staff receive no monetary recompense for working their socks off, 12-15 hour days plus weekends and Bank Holidays, staff burnt out physically and mentally trying to cope with the workload. No additional staff to assist due to cost of additional wage yet the profits soar. Greedy glutinous bosses lining their pockets as usual!!!
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