Solicitors will be able to compete directly against estate agents following a shock decision by the Law Society to totally deregulate property selling rules.
When the changes come in to force, solicitors will be able to act for both the buyer and the seller in a conveyancing transaction and offer financial services and advice.
Their firms will effectively be able to act as both an estate agent and a legal office.
The unexpected move by the Law Society Council “flabbergasted” and “astonished” solicitors groups which have spent years campaigning to remove a maze of restrictive regulations that were created in the 1980s.
The vote went against a recommendation by the council's standards and guidance committee that the society approve only a very limited form of deregulation.
The committee, chaired by Sam Wilson, feared property selling solicitors could increase the burden on the Solicitors Indemnity Fund (SIF).
However, council members, led by property and commercial services committee chair Richard Hegarty, said change to the “appalling rules” was essential to help struggling high street solicitors.
He said that while solicitors held 96 per cent of the conveyancing market, threats from licensed conveyancers, banks and estate agents could see lawyers losing 10 to 15 per cent of their market share each year.
Hegarty warned that Hambro Countrywide estate agents was already enjoying a 70 per cent success rate in referring its clients to a newly-established in-house conveyancing service run in conjunction with Eversheds, EDC Lord and Shoosmith & Harrison.
“You may not want to sell properties but the profession that you represent does,” said Hegarty.
His comments were supported by several other council members although Michael Long expressed reservations.
The decision has delighted solicitors who have struggled for years to sell property under a weight of regulations.
“It means the property selling industry will have to take us seriously,” said Phillip Hodges & Co partner Michael Garson.
Solicitors' Property Group (SPG) executive officer Leslie Dubow said that, unlike conveyancing, property selling was low risk work and the SIF would not be swamped with claims.
The SPG will give help to solicitors wanting to sell property at a local level while Solicitors' Property Centres (SPC) is preparing to launch a national chain of solicitor-owned estate agencies.
SPC director and Law Society council member Anthony Bogan said it was vital that the profession convinced consumer groups and the public of the benefit of solicitors selling property.
However, it could be as late as January next year before new property selling rules are finalised.