Is Residential Conveyancing in the Doldrums?

In June 2023, I was invited to speak at the Bold Legal Conference in London. I thought it would be a good idea to do a survey of their members prior to the event , as it would give me something to feedback at the conference itself.

As might be expected from a Big Yellow Penguin paper, the purpose of the survey was to take the temperature of the conveyancing market with an emphasis on pricing and financial know-how. The survey  of 80 firms was totally anonymous.

I  was delighted that 80 firms took up the challenge and answered  the 44 probing questions. As the survey was anonymous, I also got some very honest feedback in the comments sections  about the state of the conveyancing sector in England and Wales.

To be honest, my  feeling is the survey paints a picture of a practice area which is a little demotivated, under pressure and lacks some confidence. Perhaps it’s not

surprising, as many lawyers who have left the conveyancing sector, have done so feeling  burned out or unappreciated, and they have been unable to be replaced.  

I imagine many conveyancers  are still having nightmares about the workloads they had to deal with during the Stamp Duty holiday, when there was a massive push to get transactions  completed before the tax holiday ended.

I suspect for some the nightmares may well continue, as it is apparent that Professional Indemnity Insurers are now very concerned that the pressure of work may have created a number of professional negligence cases. These will come to the fore when people seek to sell their houses over the next few years.

The Howden Insurance Brokers Report into the Solicitors Market July 2023 is worth a read. It’s available on their website at www.howdengroup.com.

Howden report:  “Insurer appetite is a great deal more positive than we have seen for some time in the solicitors’ PII market, but this was mainly for firms with a good claims history and either no, or modest, conveyancing exposure. This was not unexpected given the current economic climate and concern about the potential for an increased level of claims activity in relation to conveyancing activity, as experienced by PII insurers during hard economic times back in the early 1990s and 2008.”

So as insurers do, they are putting up premiums now for conveyancing work undertaken some years ago. It’s almost a lose, lose!

Some of the  findings of my survey include:  

• Most conveyancers think they should be charging clients more but only a third say they and their colleagues know how to “confidently deal” with objections to fees from clients.

• Along with low confidence, it found low morale, with many conveyancers (52%) saying that, if they could “wave a magic wand”, they would leave the profession.

• More than four in five (83%) of conveyancers said they believed their firm should increase their fees, with 15% suggesting a rise of 10% and almost a quarter 20%, while 7.5% argued that they should go up by 50% or more.

• Only a relatively small proportion of firms (15%) provided service level options for clients – such as a gold, silver, and bronze service at different prices.

• A large minority of lawyers (43%) said their firm tended to some extent to “reduce prices based on what our competitors may charge”, compared to the 38% whose firms never did this.

• Two-thirds of conveyancers said they “always” understood the profitability of the firms they worked for, and a further quarter “to some extent”. However, only 22% said the people at their firm understood how decisions impacted profitability.

• Just over half of lawyers said their firms allowed them to turn work away, while 76% believed some clients should be sacked because they were “too painful and/or unprofitable to act for.”

• Law firms are poor at following up with clients after providing a quote or initial information, and this survey backed that up – only 32% said they always followed up the quotes they gave, while 23% “usually” did this.

• Over two-thirds of conveyancers (68%) thought their numbers would decrease over the next 12 months, with a further 11% predicting that the number of conveyancers would fall “dramatically.”

• The three issues most cited by conveyancers as relevant to their firm were “work-life balance challenges”, “lack of confidence when asking for an increased fee when a matter is progressing” and “risk of burn-out for some individuals.”

 In my humble opinion (and remember I was a litigation lawyer, not a conveyancer), the survey paints a picture of a practice area which is a little demotivated, under pressure and lacks some confidence.  It is a real shame as it is a sector which does really great work.

I  hope the results which were made available to over 640 BOLD Group Members,  will draw attention to how people are feeling in the sector and will hopefully encourage those in leadership positions to do something about it.

One thing is sure, action does need to be taken as there seems to be more people leaving the conveyancing profession than intend joining it in the future. This means the workloads will only increase.

A poll I produced on LinkedIn before the BOLD Conference aimed at trainee lawyers asked,

“What area of law do you intend to practice once you are qualified?”

The responses were:

• Corporate/Commercial property 46%

• Litigation/Criminal/Injury 19%

• Family/Private client 19%

• Residential conveyancing 16%

It was unscientific….and LinkedIn limits the words you can put into a poll which is why the sectors were a little clunky. However, if the percentages are to be believed, it may be that conveyancing lawyers are only going to get busier.

Curiously there does seem to be a reluctance to change. This is concerning, simply because if you do what you’ve always done, you will get what you’ve always got. We

know lawyers dislike change, but surely it needs to happen.

Are leaders up to the task of leading that change? Proactive organisations are re-engineering their business models and there are some disruptors not only on the horizon, but well and truly embedded in the profession.

I am holding an event in November for law firm leaders about how they can implement value-based pricing in their organisations. Details can be found on the BYP website- events page.

If any reader would like to receive a full copy of the survey, please do drop me a line at shaun@bigyellowpenguin.co.uk

Our iceberg is melting!