Connells Accused of Property Deceit in the UK

For Sale: A System of Deceit in the UK Property Market

A landmark undercover investigation has exposed a rotten core at the heart of the British property market. Questionable methods at a pair of the country's most prominent estate agencies, Connells and Purplebricks, have been revealed. A BBC Panorama programme showed how a drive for profit from internal financial products appears to eclipse the fundamental duty of securing the best deal for homeowners. The findings suggest a systemic issue where sellers’ interests are sacrificed for lucrative commissions. This raises urgent questions about industry regulation, consumer protection, and the trust we place in those who handle our most valuable assets. The revelations have sent shockwaves through the sector, prompting calls for significant reform.

A Seller Betrayed

The story of Julie Gallagher brings the investigation’s findings into sharp focus. The homeowner believed her property was sold for less than its potential value. She felt a profound sense of anger and deception upon learning the details. An undercover journalist discovered another interested party, an individual paying in cash, who may have been prepared to put forward a higher bid for her home. This potential offer appeared to never have been given due consideration. The reason for this oversight seemed to be a clash of interests within the selling agency. The episode left the homeowner questioning the entire process.

The Favourite Buyer

The agent from Connells handling the transaction appeared to push aside the purchaser with ready funds. A different person, who had committed to a home loan via the agency's internal financial arm, received preferential treatment. This practice, known as conditional selling, is a clear breach of the industry's code of conduct. The internal home loan alone was worth a significant sum for the firm, but it was a single component of a broader financial motivation that seemingly distorted the agent's priorities, diverting from the client.

A £10,000 Incentive

The internal mortgage was reportedly worth around £2,000 in commission to the agency. However, the potential earnings did not stop there. The full financial benefit for Connells was far greater. The company had the potential to gain up to £10,000 from the single transaction. This larger sum would come from arranging a suite of add-on services, including conveyancing. Furthermore, the agency would also secure the contract to handle the sale of the buyer's existing property, generating yet another stream of fees and commissions. This structure created a powerful motive to favour one buyer over another, regardless of the offer price.

A Breach of Trust

Julie Gallagher recalled the agent sitting on her sofa and providing assurances of working in her best interests. The homeowner later concluded this was untrue. The agent was clearly motivated by the company's financial targets. The behaviour was described as "appalling" by the disillusioned seller. Her experience underscores a fundamental conflict at the heart of the modern estate agency model. The agent's primary legal and ethical duty is to the seller, yet the corporate structure incentivises actions that directly contradict that responsibility, leaving clients feeling betrayed and financially disadvantaged.

An Industry-Wide Problem

Concerns about these practices were not isolated. The Panorama programme began its inquiry after discussions with over 20 separate financial advisers and mortgage brokers. These professionals, operating throughout England and Wales, had voiced significant worries about the way Connells conducted its business. As competitors to the agencies' in-house services, they were often the first to witness the pressure put on buyers. Their collective voice pointed towards a systemic problem rather than the actions of a few rogue employees, prompting the deeper journalistic inquiry.

Undercover in Abingdon

As a major UK property company, Connells operates over 1,200 branches across 80 different chains. To verify the claims, Lucy Vallance, a journalist working incognito, secured a position at a company-owned office in the Oxfordshire town of Abingdon. Over a six-week period, she gathered evidence suggesting the branch's manager consistently showed preference for potential purchasers intending to utilize Connells' in-house services. Mortgages and conveyancing packages were the key to preferential treatment, as they generated greater income for the company than a straightforward property sale.

The 'Hot Buyers' Board

The investigation uncovered a stark visualisation of this policy. A whiteboard inside the branch, with the heading "Hot Buyers," displayed the names of property seekers that had agreed to a home loan from Connells or a conveyancing package. This board served as a constant reminder to staff of who the priority customers were. The manager of the branch was recorded referring to these individuals as "hot buyers," demonstrating how deeply the preferential treatment was embedded within the branch culture. It created a two-tier system for potential purchasers: those who boosted company profits and everyone else.

A Cash Buyer Sidelined

The sale of Julie Gallagher's three-bedroom house became a clear case study. Marketed seeking bids above £300,000, it attracted fifteen viewings at an open house event. Afterwards, the branch manager appeared interested only in two parties, both of whom were engaged with Connells' mortgage brokers. An instruction was soon sent to the team to avoid all further viewings. One of these "hot buyers" ultimately secured the property. Meanwhile, an individual with cash and seemingly deeper pockets, who was not using the company's services, was effectively ignored. This action directly limited the seller's chances of achieving the highest possible price.

An Unacceptable Justification

Connells later claimed they had spoken with the cash purchaser, who had not yet decided on bidding. The company also stated that a subsequent phone call from that buyer went unanswered, and no return call was made. However, the incognito journalist was informed of something different by an office administrator. When the reporter mentioned the cash-funded buyer could have bid higher, the administrator explained that a simple sale was insufficient for the firm. The priority, the administrator said, was to secure buyers who signed up for in-house services to meet demanding internal targets.

Image Credit - Freepik

Defining Conditional Selling

The method known as 'conditional selling' is explicitly banned under the Residential Estate Agents' Code of Practice, to which Connells is a signatory. It occurs when an agent implies, suggests, or states that a buyer must use the agency’s internal services, such as home loans or legal work, to have their offer seriously considered or accepted. It creates an unfair advantage and prevents a level playing field for all potential buyers. Agents who subscribe to the guidelines are obligated to refrain from discriminating against purchasers not using their in-house services.

A Legal Grey Area

Despite the clear rules against conditional selling, a legal loophole may exist. The 1979 Act governing Estate Agents classifies discriminating against buyers that don't utilize internal brokers as an 'undesirable practice'. This can trigger an examination by the Trading Standards authority. However, experts suggest the existing regulations might not adequately cover the more subtle practice of simply sidelining or deprioritising possible purchasers, as was observed by the Panorama reporter. Iona Bain, a financial journalist, has pointed out this "grey area" allows agents to effectively favour one buyer without explicitly stating the condition, thus evading direct legal consequences.

Calls for Investigation

Lisa Webb, a specialist in consumer law from Which? magazine, reviewed the evidence gathered by the investigation. She described the behaviour as representing actions that "ought to be illegal." Webb expressed a strong opinion that the estate agencies involved should be examined by official bodies for their actions. The covertly filmed footage of the manager of the branch explaining the financial motivations behind favouring the "hot buyer" was particularly damning. The expert called the behaviour detailed in the footage "appalling," reinforcing the severity of the findings and the need for regulatory scrutiny.

The Official Response

When confronted with the findings, Connells rejected all claims of conditional sales tactics. The company insisted that "no damage was done" to the client. A spokesperson stated that while there were different bids for the property, the accepted bid was the top one. The firm also claimed that clients using their home loan services do not have a higher success rate in buying a property compared to those who don't. It noted that during the six-week undercover period, only two of fourteen sales went to buyers utilizing the internal service.

A Commitment to Training

Connells further stated that it dedicates "substantial resources and time to team training." This training, the company claimed, is to ensure staff understand the legal and regulatory framework they are required to work within. The spokesperson added that any staff member discovered violating these rules would be subject to firm disciplinary measures, which could include dismissal. The manager of the branch implicated in the report declined to comment directly. She indicated that she agreed for the official response from Connells to represent her, distancing herself from personal accountability.

Trouble at Purplebricks

The investigation also turned its attention to the digital property firm Purplebricks. Concerns had been raised that the firm was intentionally inflating property values to secure new clients. An insider, an ex-sales negotiator, began secretly filming online meetings after becoming frustrated with the company's practices. She told Panorama that employees received commission as a reward for convincing vendors to reduce their asking prices after an initial period of being for sale. This suggests a strategy of securing listings with inflated valuations and then correcting them later, a practice that misleads sellers from the outset.

Inflated Prices, Guaranteed Commission

This insider, employed at Purplebricks from June to October 2024, provided evidence of these practices. She was told by one of the firm's local agents that they were "massively overvaluing properties simply to get new listings." Significantly, employees could then receive a commission if they successfully persuaded vendors to decrease their initial price. The same individual indicated to her that achieving 18 such price drops in a month could yield a commission of £900. This creates a perverse incentive for staff, rewarding them for correcting initial, deliberately misleading advice.

The Art of the 'Price Drop'

Secretly recorded online meetings revealed the tactics taught to staff. A team supervisor was filmed instructing employees on how to manage conversations about price reductions with sellers. The strategy involved "planting the seed" early. Staff were told to inform sellers that if their property did not attract significant interest in the initial month, a "discussion regarding a reduction" would be necessary. This approach frames the inevitable price drop not as a correction of a deliberate overvaluation, but as a natural market response, subtly shifting the blame onto the seller's property.

Pressure to Sell Add-Ons

Similar to the issues at Connells, the Purplebricks insider also revealed intense pressure on employees to market financial offerings. Home loans and legal services were a key focus. The company actively steered clients to use its chosen conveyancing partners rather than shopping around for a better deal. A team leader was recorded in a meeting explicitly telling staff not to encourage comparisons. He stated in a virtual meeting, advising against comparison quotes because the company's pricing was significantly higher. This admission reveals a clear intention to profit from customer ignorance.

Image Credit - Freepik

A Costly Experience

The case of Olivia Phelps and Ryan Evans illustrates the consequences for consumers. The couple purchased a two-bedroom residence via Purplebricks and were provided with legal services for the transaction via the agency. Their payment was £2,820 last summer. A check on price comparison platforms found this amounted to almost triple the current cheapest quote for a similar property. As first-time buyers, they admitted they were unaware. The experience left them feeling that the company had exploited their inexperience in the property market.

'Squeeze Every Lead'

The pressure-selling culture was further exposed by recordings of the insider's supervisor. In one meeting, he was recorded firing up his staff to maximise sales of add-on products. He told the team to "extract maximum value from every single lead." The team supervisor urged staff to act with "more persistence." He stressed the great urgency, noting a "heinous amount of money" was available. This language highlights a corporate culture focused squarely on aggressive profit extraction rather than genuine customer service.

Purplebricks Responds

Purplebricks told the BBC that although securing lower prices was previously a goal for staff incentives, that is not the current policy. The company denied that it overvalues homes to secure business. It also rejected all depictions of its service as involving pressure-selling, stating it concentrates on the advantages of its suggested services, rather than their cost. The company also issued a statement, noting that new ownership from 2023 has prioritised enhancing service and fostering a customer-centric culture. The supervisor featured in the recordings had since left the company and declined to comment.

An Unfair Fallout

The revelations have sparked a debate about who bears responsibility for these institutional failings. Ian Macbeth, managing director of Avocado Property, warned that while corporate executives manage the public relations crisis, it is the frontline staff who face the immediate consequences. He argued that customer-facing negotiators and valuers are often just following the training and instructions handed down from senior management. These employees, he suggested, are left to deal with public anger and demoralisation, while the decision-makers "disappear into the background."

A Tarnished Reputation

Industry experts have noted the significant reputational damage to the agencies involved and the wider property sector. The investigation suggests the problems are not isolated incidents but are systemic within the companies. Paul MacKenzie-Cummins of Clearly PR described the situation as a "PR nightmare" rooted in a breach of trust and dishonesty. The public perception is that the industry is tainted, as many will read the story and see the word "estate agents" rather than the specific company names, casting a shadow over all professionals in the field.

The Regulator's View

In the wake of the broadcast, the industry's professional body, Propertymark, issued a response. CEO Nathan Emerson commented that agents are required to "offer a complete duty of care and guarantee impartiality for every participant." He stressed that purchasers and vendors must have the freedom to choose their own service providers and that there must be "full transparency and absolutely no conflict of interest." However, some industry commentators have questioned the effectiveness of such bodies, pointing out that large firms like Connells are major members who effectively fund the regulator, creating its own potential conflict of interest.

The Consumer's Dilemma

This investigation highlights the immense vulnerability of consumers in the property market. Buying a home is the largest financial transaction most people will ever make, yet many, particularly first-time buyers, lack the experience to navigate its complexities. They are forced to place their trust in agents who, as the evidence suggests, may be systematically prioritising profit over their clients' welfare. The pressure to make quick decisions, the opaque nature of ancillary service costs, and the emotional stress of the process all create a perfect environment for exploitation.

A System in Need of Repair

The core issue is a business model that creates a direct conflict between an agent's duty to their client and their duty to their employer. The lucrative commissions available from selling mortgages, conveyancing, and additional products create an irresistible incentive to bend, and sometimes break, the rules. Until this fundamental conflict is addressed, the problems are likely to persist. The current regulations and enforcement mechanisms, handled by an already over-stretched Trading Standards service, appear inadequate to protect consumers from these deeply embedded, profit-driven practices. Greater transparency, stronger regulation, and genuine accountability are urgently needed.