Latest thought

Conflicts of interest within the estate agency business. 

31st July 2025

A couple of weeks ago the BBC produced a Panorama programme that focused on conflict of interests, where estate agencies were putting their own interests ahead of their “customer’s interests”, by which the programme makers appeared to mean the interests of the person selling a home. The programme focused on Purple Bricks as well as a Connell’s office in Abingdon. Negotiators were incentivised to favourably ringfence certain buyers who took out mortgage services through their own mortgage advisers, thereby earning themselves extra commission on top of the fee the firm would make selling their home . Both sellers and buyers were losing out, argued Martin Lewis, a well-known financial expert. Sellers were not achieving the highest potential price because some perfectly sound buyers were not even being considered. Cash buyers, normally preferred by most sellers, were filtered out of the transaction in favour of less attractive buyers, purely because the less attractive buyers were going to earn the estate agent more money. The financial journalist Iona Bain gave the standard view that “the estate agent should work for the seller” and ensure that “they are really acting in your best interests.”

So where do we start? Let’s start with “definitions”. When Connells as part of their defence stated “we put our customers first”, we can see how they may have tripped themselves up. Normally in a shop, the person walking in off the street to buy something is known as the “customer”. In the world of property this would mean the buyer. But the words “client” and “customer” have become confused where some estate agents fail to understand that the customer is the buyer, to whom they owe a duty of care not to mislead, while their client is the seller, and because the seller pays the estate agent’s fee it is the homeowner’s interests in whom the estate agent should be acting.

While the Panorama programme highlighted a serious problem, there is a more serious problem where estate agents act for both buyer and seller. This was not mentioned in the programme. It seems incredible that such a practice should occur but it does, even on the same property. The same lawyer, quite rightly, is not permitted to act for both parties on the same transaction owing to a blatant conflict of interest. But estate agents often do act for both parties in this way and have been doing so for approximately the last 20+ years. So if the same estate agent is acting for both buyer and seller, are they trying to drive the price UP or DOWN? (Or do they care?) In whose interests are they acting? They can’t be acting for both.

I wrote to the RICS (Royal Institute of Chartered Surveyors) in July 2009 highlighting this problem. The reply I received dated 16th July 2009 said that “the RICS has received no complaints on this issue” and argued that estate agents can act for both buyer and seller on the same property “if both buyer and seller give their informed consent.” But does the RICS know what steps firms are taking to ensure that full transparency is achieved? The RICS were asked to comment on this specific issue last week but have declined to do so. Let’s face it, it’s a touchy subject and awkward at best. If I knew my lawyer was also acting for the other side in any deal, I would be asking some serious questions, or better still walk away from the deal altogether.

The mistake Connells made was putting their own income stream ahead of trying to achieve the optimum price for the seller. However, worse still, if any estate agent, as it appears they do, are milking both ends of the deal, then clearly this is at the very least poor practice and possibly illegal. Everyone needs to understand that estate agents have their own drivers and motivations. At Hanslips we only act for buyers. There is no conflict of interest. We will protect your position and secure the best deal.