Record attendance for The Law Society Annual Property Conference 2011

Attendance at the Law Society's property conference in London this month was the highest since 2008. Perhaps this demonstrates the need for firms to come together for support as they grapple with upheavals in the legal services sector and conveyancing market.

Chancery Lane’s former property "tsar" Paul Marsh, consultant at Surrey firm Downs, outlined challenges stemming from low transaction volumes, new regulations and the introduction of alternative business structures. Marsh predicted there will be no significant increase in work for the next five years, resulting in overcapacity and a "brutally competitive" market, with more downward pressure on fees.

He warned: 'High street firms face a period of intense competition. They will have to get more than their fair share of the market, which will mean competing against each other and thinking how to get extra transactions.'

An important part of that effort, said Marsh, will be marketing. He advised firms to make use of every tool available, including The Law Society’s Conveyancing Quality Scheme accreditation.

In common with most speakers, Marsh did not expect the advent of ABSs - marked at the beginning of the month by an application from licensed conveyancer Premier Property Lawyers to change its status - to have a far-reaching early impact.

On the prospect of big high street brands entering the market, Marsh said they would only do so as a means to an end - to capture clients to whom they could sell other goods or services.

The chairman of The Law Society’s conveyancing and land law committee, Jonathan Smithers, also questioned whether investors would be interested in conveyancing firms. While ABSs might help smaller practices, particularly sole practitioners, who could attract a non-lawyer partner to help them to retire, he warned: 'There is no silver bullet to make the conveyancing market better with external capital.'

His advice to struggling firms, especially if big high street brands enter the market, was to 'compete on quality and not price; become known for your expertise in your local market.'

Referral fees were another talking point, following the government’s proposal to ban their payment in personal injury work. In a straw poll of the 150 delegates, 61% voted in favour of banning referral fees in conveyancing transactions, although 80% believed that even with a ban, fees would continue to be paid under a different guise.

Law Society deputy vice-president Nick Fluck reflected on the mixed response to referral fees, with some firms abhorring them, while others see them as a cost-effective way of marketing. He did not expect any ban to be extended to conveyancing and said that referral fees are something that the profession may have to live with. Given the state of the property market, Fluck suggested that 'sooner or later we may all have to consider taking a walk on the dark side'.

Marsh concluded his address on an upbeat note: 'There is a good future for local conveyancers. Solicitors still have 90% of the conveyancing market.'

     

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