Referral fees to be totally transparent

Following a review, which lasted over a year, the National Trading Standards Estate and Letting Agency Team (NTSELAT) has, today 2 October, proposed that new legislation be introduced so that all customers must be told about third party referral fees when buying or selling a home. This is to improve transparency across the sector and ensure consumers feel confident in the services agents provide.



Propertymark has worked with NTSELAT and the Ministry of Housing, Communities and Local Government (MHCLG) over that period to avoid referral fees being completely banned. Lobbying since 2017, a response to a call for evidence on the Improving the home buying and selling process was submitted by Propertymark, outlining our thoughts on why referral fees should be transparent, and why the banning of them would have a detrimental effect on estate agency businesses.

Continued campaigning and working with Propertymark members through regular communications and webinars will continue, to ensure all referral fees are displayed and fully transparent.


Following NTSELAT’s review, it was noted that the practice of referring customers to a preferred service provider in exchange for a fee is regularly concealed. Many customers remain unaware of the existence of referral fees and in some situations, customers may be pressurised to use a preferred provider despite the fact it does not meet the needs of the customer or provide the best value.

All estate agents must now make sure they follow industry guidance otherwise they could be banned altogether.


To deliver the recommendations and to support estate agents to disclose referral fees, NTSELAT is developing further industry guidance and will work with professional bodies and redress schemes to encourage compliance in the property sector.

The recommendations include:

  • Proposals for UK Government to make transparency of referral fees mandatory and require a warning to be given to customers that they should consider shopping around
  • A public awareness programme to warn consumers about hidden referral fees
  • Further industry guidance, and work with the professional bodies and redress schemes to encourage compliance in the property sector

We recognise that referral fees have a place in business if used ethically and transparently and with no pressure to use the referred service. It is important that customers are fully aware of the basis and value of a referral or recommendation, so they are able to take an informed transactional decision. Mandatory disclosure of referral fees would ensure there is full transparency around this practice, helping to build consumer confidence in the estate agency industry and demonstrating the duty of care agents should have to both parties in a property sale.

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James Munro Senior Manager | National Trading Standards Estate & Letting Agency Team

New legislation that will require agents to display referral fees is a step forward, providing clarity to agents that they mustn’t fall foul of the law but importantly ensuring greater transparency for consumers to avoid any confusion about what agents are charging for.

This is something we’ve been working closely with UK Government and the National Trading Standards on, and given that agents were facing a complete ban of referral fees, we would strongly advise that anyone who isn’t currently displaying their fees should start now, regardless of when the new laws will come into force.

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Mark Hayward Chief Executive | NAEA Propertymark