2022 saw the conveyancing industry once again pull together to get people moved despite economic and practical pitfalls aplenty. This did, however, come against a backdrop of incessant innovation in an industry which seldom stands still.
With this in mind, there is much to consider as conveyancers look towards 2023. Here are the thoughts of several key voices on what to expect.
What area of conveyancing will change the most in 2023?
Progress towards greater use of upfront information was foremost on the agenda of Stephen Ward, Council for Licensed Conveyancers, which he says will “help speed up the conveyancing process and provide consumers with more confidence at the outset of a transaction”.
Rob Hailstone, CEO, Bold Legal Group, echoed Ward:
“I’m hoping with the introduction of phases B & C of the new Material Information requirements we will see conveyancers and agents working together earlier on in the home selling process, and that by doing so transaction times will begin to improve.”
This comes as the Home Buying and Selling Group recently announced the first publicly available version of their Digital Identity Trust Framework. HBSG Chair Maria Harris said it has been a “tough couple of years” for conveyancers, but there will be “some big changes in how conveyancing organises itself and where best to invest in its people, technology, and resources” in 2023.
Indeed, technological development was a theme touched upon by almost all of those polled by Today’s Conveyancer. Laura Cartwright, Partner, Bell Lamb & Joynson, said:
“Digitalisation will open up a range of opportunities for improving the conveyancing experience.
Research has confirmed that there are many firms determined to do more with some already well ahead of the game.”
On how firms can best adopt new tech, Cartwright said:
“Change management is an effective way to approach the digitalisation of conveyancing – understanding the need for change, plan, implement, and then communicate. Consideration of these factors will be crucial for change in 2023.”
Rubina Ferreira, Consultant Residential Conveyancing at Woodstock Legal Services, noted that “many firms still insist on obtaining client ID and anti-money laundering (AML) checks via certified paper copies of ID”, continuing:
“There are a lot of onboarding client platforms that provide AML and Source of Funds (SoF) electronically. Hopefully we will see more firms take this up as it is a more efficient way of onboarding clients digitally and will speed up the initial onboarding process.”
Ferreira also touched upon the move towards e-signatures:
“E-signatures should be used to obtain signed Contracts and Deeds. Especially given the postal strikes towards the end of this year, there should be no reason why firms cannot start using e-signatures moving forward.
There have been a lot of cases where this has caused delays in exchanging and completion due to certain firms requiring ‘wet’ signatures.
I am a huge advocate of this [change] and the Land Registry has provided guidance under Practice Guide 82 regarding e-signatures.”
Simon Law, The Society of Licensed Conveyancers Chair, shared Ferreira’s views regarding e-signatures:
“The MOJ’s Industry Working Group on the Electronic Execution of Documents final report is due out soon: hopefully this will help to facilitate conveyancers moving to using digital signatures with confidence. A large part of the industry has already moved to using fully electronic identification and this should continue in 2023. The SLC will look to further collaborate with the rest of the industry to reduce transaction times and improve conveyancing for not only the consumer but conveyancers as well.”
Charlie Davidson, Associate Solicitor, Bishop & Sewell, said an increased interest in electronically executed Deeds “could move the entire industry away from a paper-based system”, adding he’s expecting the views of financial institutions adopting this en mass alongside primary legislation on the matter in 2023.
Davidson also said that “with the high interest rates, and the pound being less valuable, we are expecting an increase in overseas buyers and “non-standard” transactions”:
“Conveyancers will have to turn from their pre-printed documents and pre-contract enquires and engage with the underlying financial and legal principles of more and more deals.”
Philip Armstrong, Managing Director, Armstrong Solicitors, noted that Northern Irish conveyancers may be engaged in a debate around separate representation “due to the widespread unhappiness with the experience of dealing with lenders and their panel managers”. He also noted the need for increased fees, allowing conveyancers to “do fewer cases better”.
The hurdles that lie ahead for conveyancers next year
Of the many changes and developments expected in conveyancing, some will naturally present hurdles for conveyancers. Philip Armstrong noted the difficulties in competing with conveyancing “factories” who “undercut the conveyancing specialists who focus on expertise and service”. Armstrong said this comes against a backdrop of recruiting and retaining great conveyancers amidst rising costs.
Armstrong’s latter point was echoed by Simon Law, who said resources will be the “main issue” for conveyancers in 2023:
“Since 2008 we have seen a long drawn out drain of talent from conveyancing. This, coupled with the difficulties in training and increased costs of qualifications and increased burdens on conveyancers, has led to a lack of resource and capacity in the market.
We really need to have a look at the industry and how we interact with each other, and make changes to become a place wherein people want to work.”
Transaction volumes were an issue raised by Laura Cartwright:
“Given the economic dark clouds, there will be a reduction in conveyancing transactions. The last two years have been the exception rather than the rule. The return to normal will be challenging as we adjust to case levels.”
The issue of fees is, therefore, “imperative”:
“It’s imperative that conveyancers understand their worth and ensure they charge a true reflective cost for the work they do. It’s also important to focus on remote working issues such as isolation, division, employee engagement, and the impact these factors have on mental health.”
Rob Hailstone touched upon this point, suggesting conveyancers will need to “hold their nerve” so that “no matter what conveyancers’ work volumes are, they charge what the rigours of being a 21st century conveyancer deserves”.
Delays to transactions will also bring issues, said Rubina Ferreira, who said the issue is worsened by panel solicitors:
“Referral fees should be banned in 2023 having caused huge problems in conveyancing in 2022. They have caused delay in transactions by agents referring cases to their panel solicitors who are not the most proactive and who do not communicate and collaborate with the other side’s solicitors.”
Ferreira added these challenges make adoption of new, more efficient ways of paramount importance:
“If firms do not adapt to these challenges by way of digital onboarding of clients, e-signatures and being proactive in getting transactions through, a lot of these firms will begin to suffer significant losses in the New Year.”
Conveyancers will be under “increasing pressure to deliver the customer experience and technology standards that deliver the ‘good outcomes’ that the rest of the industry will be measured by”, said Maria Harris, adding:
“Having a joined-up approach to collaboration and solution building has been a barrier for too long but will be a key factor in enabling progress.”
Stephen Ward said any slowdown would give firms an opportunity to “review their operations and take advantage of the new tools that are out there”, and to “see what innovations they can employ to ensure clients are provided with the most efficient and secure process possible”.
On the issue of anti-money laundering, Colette Best, AML Director at the SRA, said “it won’t surprise you to know that conveyancing remains the service most likely to be targeted by money launderers”.
Moving forwards, money laundering “remains a priority risk” for the SRA: “Where we find poor compliance with the regulations, we will take action,” added Best. On new trends and the biggest risks that lie ahead, the SRA AML Director said:
“[We’re seeing] new trends around financing legal services, such as cryptocurrency and clients seeking to evade currency controls in their home country. These make it more difficult to identify the source of funds.
Probably the biggest risk across the board is complacency. The profession should recognise that everyone might be targeted, big or small, and regardless of the areas of work they carry out. Firms should regularly assess their processes, have the right policies in place and make sure that staff are regularly training on their obligations.
This will be especially important against both a worsening economic situation and potentially action against the UK from hostile jurisdictions. Firms must make sure that they are carrying out the right checks with regards the Government’s financial sanctions regime, as well as their normal anti-money laundering due diligence.”
2023 brings cause for optimism
In spite of the challenges 2023 is destined to bring, there is plenty of cause for optimism brought by the abundance of innovation and development the industry will see next year. On this, Maria Harris said:
“I’m hugely excited to see the HBSG’s digital upfront information – alongside the work that HM Land Registry, GeoSpatial, etc. are doing with their data converge – start to come to life with real customers on live transactions.
There’s a lot of great technology and data solutions working on improving the process and a big push within government to improve the data standards and provenance that will get us past the tipping point we need to reimagine the whole home buying experience.”
Rob Hailstone said he is “looking forward to the first ever National Conveyancing Week (NCW) set to take place in March 2023, which is being “kindly supported by a whole host of businesses that work with conveyancers on a regular basis, meaning that conveyancer involvement will be absolutely free”.
Stephen Ward plans to “really get back out there to see more of [the CLC’s] regulated community face-to-face” next year, something he is looking forward to along with the return of the CLC’s annual conference.
Laura Cartwright said she is excited to “continue to provide an excellent service to our clients, expand the team, and ensure the best onboarding and training of new staff”. On the latter point, Cartwright added:
“We have trainee solicitors qualifying, plans for junior members of staff to progress and strive to continue understanding the cultures and needs of people, listening to their ideas and innovations as well as building a loyal and talented team.”
“If 2022 was the tail end of frantic activity, we are expecting 2023 to be a period of incubation and consolidation,” said Charlie Davidson, continuing:
“The slowdown may be bad for the quarterly earnings, but it will give conveyancers time to breath and get to grips with new developments. It is no secret that there has been a herd of experienced conveyancers leaving the industry – perhaps now is the time to start reinvesting in our future.”
Simon Law touched upon the “collaboration and communication” he sees as crucial next year:
“COVID gave us many issues, however it did lead to greater collaboration within the sector as we worked together to get through the various lockdowns and challenges.
This has largely been eroded over the last 12 months as the sector returns to pre-pandemic ways of working. Greater collaboration and communication is fundamental in changing the way conveyancing is undertaken.”
Philip Armstrong said his firm are changing how they market their conveyancing services which, alongside the introduction of an upgraded conveyancing web app, will lead his focus on the client experience of moving house, turning it “from a negative to a positive”.
