Which conveyancers are likely to be the biggest winners in the industry over the next five years? That’s the conversation we’ve been having as an industry in editorials, boardrooms, and over the tinkling of glasses this summer.
Rapid technological changes are driving conveyancing and its ancillary industries, and with recent reforms we can see a hazy shape of things to come in the next five years. Land Registry, for example, is to become the central source of LLC1 searches as part of the current government’s open data move; the initiative has been welcomed by some in the industry, but equally criticised by others. Here at Search Acumen, we’re inspired by the opportunities created by advancing technology, and so we’ve welcomed the changes. We understand the need for conveyancers to have quick and easy access to information currently hidden within big data sets.
Fraud is another bugbear that is doing the rounds in the news. Conveyancers fall victims to this and are in a dreadful position where they could lose a position on lenders’ panels while fraudulent activity is investigated. There is also the risk of lost trust and a damaged brand name that could take months or even years to recover. Those who are winning the battle with fraud deserve the industry’s praise.
But we must remember that the successful conveyancers of the future will be determined as much by how they acquire work in the next five years as their technological prowess and anti-fraud practices. In fact, we’re predicting two polarised scenarios that could play out very differently for the industry.
If introducers – estate agents and brokers – go on to dominate the market, then larger consolidated firms with the finances in place to pay big introducer fees are likely to survive and prosper. We’re already seeing a decade-long pattern where the bigger firms have managed to acquire a lion’s share of transactions. The top 200 firms achieved a collective 36% market share in 2014, up by ten percentage points from 26% during the peak of the recession in 2007.
Alternatively, another scenario could play out if online estate agents and conveyancing portals come to control a large portion of the market, in which case the smaller and agile firms will be the ones who thrive. These firms, in most cases, can also price work locally and more competitively.
Midsize firms therefore have a reason to be apprehensive, because they neither have the volumes to pay introducer fees, nor the competitive, local ‘boutique’ approach many consumers gravitate to as an alternative to bulk conveyancing houses.
The fate of introducers, particularly estate agents, will have a direct impact on the future prospects of conveyancers and this needs to be addressed in their contingency plans immediately. It’s absolutely vital for conveyancers to get the best out of their systems and processes, communications and client service to add value to their offering, so they are not swallowed up as a result of a radical shift in the food chain.
