Access FS reveals harmful effects of conditional selling
27 June 2024
The unlawful practice of conditional selling by estate agents is getting worse and harming customers, reveals an Access Financial Services survey.
Conditional selling is when an estate agent tells a prospective buyer that they must use the agent’s in-house broker in order for their offer to be put forward on a property.
Nearly two thirds (63%) of Access Financial Services mortgage advisers surveyed said that their clients have experienced conditional selling in the six months from November 2023 to May 2024. Of that group, 100% of advisers said it caused their client harm such as stress, hassle or confusion.
A third (33%) of advisers surveyed believe that conditional selling has got worse in the past six months until May. The same proportion (33%) think the problem is about the same. 30% don’t know, and 4% think it’s getting better.
Perhaps most concerning for the property industry, is that more than four out of five (83%) of mortgage advisers feel like there are some estate agencies where conditional selling is almost standard practice.
Karl Wilkinson, CEO of Access Financial Services, said: “Something is broken in the property industry when this practice continues after 20 months of our campaigning against conditional selling, and developing tools and processes to protect advisers and their clients.
“A significant minority of estate agents are being allowed to continue to negatively impact our industry. This has to stop.”
Wilkinson continued, saying: “Conditional selling is morally wrong and a clear breach of Consumer Duty as well as The Property Ombudsman’s Code of Practice and the Estate Agents Act 1979. What other industry puts up with this kind of harmful behaviour? We can do better.”
To help counter conditional selling, Access Financial Services has created two free letter templates for financial advisers and their clients – one to estate agents making them aware of the situation and, failing a positive response, a second letter to request support from the property ombudsman.
When asked to describe experiences of conditional selling in the past six months, advisers referenced customers who were denied the opportunity to purchase a property because they refused to choose the agent’s broker.
Another adviser referred to a series of first-time buyers, all of whom felt pressured into using the agent’s inhouse adviser.
While very worried about losing the house they wanted to buy, one adviser’s client also felt annoyed that they were forced to use a service they didn’t want. They didn’t understand why they had to use a mortgage adviser that they didn’t know and trust. Another adviser said one of his clients expressed confusion as to why they were being denied the fundamental right of free choice when it came to buying their home.
