Watchdog recommends “shake-up” of estate agency market

| February 19, 2010 | 0 Comments

The Office of Fair Trading (OFT) is recommending a “shake-up” of the way in which most Britons sell their homes, including new legislation that encourages innovation in the estate agency market.

Following a study of the home-buying and selling process, the watchdog concludes: “The housing market remains dominated by traditional estate agents with weak competition between them on price”.

It wants to see new entrants to the market, particularly online services, but warns that current legislation dating from 1979 may need amending to ensure new business models are not burdened by inappropriate regulation.

The only area where the OFT recommends the Government should consider additional rules is around the fees received by estate agents for referring buyers to other service providers, such as mortgage advisers, surveyors, and conveyancers.

OFT chief executive, John Fingleton, comments: “In the present economic climate it is more important than ever that people get a good deal when buying or selling a home.”

He adds: “Encouraging new business models, online estate agents and private seller platforms could put useful competitive pressure on traditional models and lead to better value for buyers and sellers.”

However, traditional estate agents are also in line for some praise because the research indicates that satisfaction with their services has improved in recent years and where problems with transactions occur, consumers don’t generally think their estate agent is to blame.

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