Referral fees: Contentious issue
An estate agency has been praised for publicly disavowing future demands for referral fees, describing them as “the quiet scandal” in the industry.
Carringtons in Kingston upon Thames, south-west London, said dropping referral fees from conveyancers and other service providers “removes one more thing that gets in the way of a straightforward move”.
“No kickbacks, no ‘introducer fees’, no small print,” the company said in a newsletter. “If we recommend someone, it is not because they pay us, it is because they are good at their job.”
The problem with referral fees was “obvious”, it went on. “It creates doubt. Are they recommending them for you, or for them? We do not want that anywhere near our business.”
This produced “less friction” because “everyone involved is there on merit, not because of a side deal”. And while, on paper, “we are walking away from extra income… In reality, it keeps things simple”.
Paying referral fees have long split the profession and writing on LinkedIn, Richard Spencer, co-founder of Cheltenham firm Converse Law, responded: “This is how referrals should work. The clients of other agents deserve this level of transparency.
“Now, if only some solicitors and conveyancers would stop paying kickbacks, the public would have a much better chance of finding firms who focus on providing 5* service.”
Stephen Larcombe, chair of the Property Lawyers Alliance, praised Carringtons’ “bold decision”.
He said: “Their words echo what many of us have long argued: conditional selling and opaque referral arrangements undermine both consumer protection and professional integrity.
“The recent BBC Panorama investigation highlighted how first-time buyers were charged nearly three times the cheapest conveyancing quote simply because of estate agent referral practices. This is not just a matter of transparency – it is a matter of fairness, accountability, and restoring trust in the home buying process.”
Panorama focused on conditional selling – where agents are incentivised to encourage buyers to use in-house services, such as conveyancing – and in the wake of it, the Council for Licensed Conveyancers said it would undertake a review of referral arrangements.
The PLA has set up a task force to respond to the government’s consultation on home buying and selling reform and Mr Larcombe said tackling referral fees would be one of the key elements.
“Our campaign calls for an outright ban on referral fees that compromise consumer choice, clearer disclosure requirements to prevent hidden commissions, and independent oversight to ensure reforms are not captured by vested interests.”
He said: “The message is simple: home buyers deserve advice based on merit, not kickbacks…
“The ‘quiet scandal’ is no longer quiet. It’s time for government to act – and for our profession to stand united in defence of transparency, fairness, and consumer trust.”
