The Most Common Compliance Mistakes Estate Agents Make (and How to Avoid Them)

Compliance is not the exciting part of running an estate agency. It rarely helps win instructions directly. It does not create more viewings. And it is easy to push down the priority list when the phone is busy and negotiators are chasing deals.

But compliance mistakes are often the reason agencies face complaints, redress disputes, legal risk, and reputation damage.

In today’s property market, clients expect accuracy, transparency, and professionalism at every stage. When even small details are handled poorly, it can create distrust. And once trust is lost, problems escalate quickly.

The good news is this: most compliance issues are preventable.

They are usually not caused by bad intentions. They happen because processes are inconsistent, staff are under pressure, training is outdated, or key information is not documented properly.

This article covers the most common compliance mistakes estate agents make, why they happen, and how to avoid them with simple, practical improvements.

1) Using marketing language that can’t be proven

This is one of the most common mistakes, and also one of the easiest to fix.

In a competitive market, negotiators want listings to stand out. So descriptions often include phrases like:

• “Recently refurbished”
• “Plenty of parking”
• “10-minute walk to the station”
• “Large garden”
• “No onward chain”
• “Ideal investment opportunity”

The issue is not the language itself. It is whether the claim is accurate and evidenced.

Why it’s risky

If a buyer later believes they relied on incorrect information, it can lead to a complaint or claim of misrepresentation.

How to avoid it

Introduce a “verified vs unverified” process:

• Any factual statement must be checked
• Anything unverified must be worded carefully
• Vendors must approve the listing in writing
• Keep signed property information forms on file

It is far safer to market confidently but accurately, rather than aggressively but vaguely.

2) Not disclosing material information early enough

Material information is anything a buyer (or tenant) would reasonably need to know before making a decision.

Many agencies hold information back unintentionally. Often because they assume it will be “explained later”.

Examples include:

• short lease lengths
• service charges and ground rent
• restrictions or access issues
• known neighbour disputes
• planned developments nearby
• structural history or previous flooding

Why it’s risky

If a buyer discovers key information later, they feel misled, even if the agent did not intend to hide it.

How to avoid it

Create a simple material information checklist and apply it before marketing goes live.

If the information is not available yet, you should:

• request it from the vendor
• document that it is pending
• avoid claiming anything until confirmed

3) Weak record keeping (the silent compliance killer)

A surprising number of complaints escalate because agencies cannot prove what happened.

In most disputes, the key issue becomes:

• what the agent said
• what the client understood
• what was agreed
• when information was provided

If it is not logged, it is hard to defend.

How to avoid it

Make record keeping a daily habit. It does not need to be long. It needs to be consistent.

At minimum, log:

• valuation advice and pricing evidence
• marketing sign-off
• all offers (amount, conditions, time sent to vendor)
• key conversations and advice
• complaints and responses

Your CRM should be treated as evidence, not admin.

4) Poor handling of offers

Offer handling is one of the biggest complaint areas in estate agency.

Common problems include:

• offers being passed on late
• offers not being logged properly
• missing buyer details and conditions
• vendors claiming they weren’t informed
• buyers claiming unfair treatment

Why it’s risky

Offer disputes damage trust fast. They can also lead to legal escalation if someone believes they have been treated unfairly.

How to avoid it

Standardise offer handling:

• log the offer immediately
• include conditions and buyer position
• inform the vendor promptly
• keep a record of vendor response
• confirm key stages in writing

This is a simple process that protects everyone.

5) Lack of clarity around referral fees and third-party services

Many agencies have partnerships with:

• mortgage advisers
• solicitors / conveyancers
• surveyors
• insurance providers

Referral arrangements are common and legitimate. But problems occur when the client feels the arrangement was hidden.

How to avoid it

Make referral disclosure clear and proactive:

• disclose referral fees early
• explain why the referral is recommended
• confirm the client has freedom of choice
• record the disclosure in writing

Transparency is the difference between a trusted recommendation and a compliance issue.

6) Lettings compliance being treated as “back office”

Lettings compliance carries serious risk because it is process heavy. And disputes often arise months later.

Common mistakes include:

• missing deposit deadlines
• prescribed information not issued correctly
• safety certificates not tracked properly
• unclear maintenance responsibility
• incomplete tenancy documentation

How to avoid it

Use a tenancy compliance checklist for every tenancy.

Include:

• deposit steps and dates
• certificate expiry tracking
• landlord approval records
• repairs log with timeline
• clear tenant communication history

In lettings, consistency is everything.

7) AML and sanctions checks not being documented properly

Many agencies complete checks but fail on record keeping.

This becomes a problem during audits, complaints, or if suspicions arise later.

Even where checks are completed, missing evidence can create compliance risk.

How to avoid it

Create a clear AML file structure:

• ID check proof stored correctly
• risk scoring documented
• proof of funds logged
• escalation notes recorded
• staff training evidence available

8) Staff training is inconsistent or informal

Many compliance failures happen because staff “think they know”.

This includes:

• negotiators relying on old habits
• new staff copying old processes
• people improvising under pressure
• uncertainty around what must be disclosed

How to avoid it

Keep training short and regular.

Best practice:

• monthly 20-minute compliance refreshers
• simple case studies from real scenarios
• training records stored centrally
• onboarding checklist for new joiners

Compliance training should feel normal, not like punishment.

9) Assuming compliance is someone else’s job

This is the cultural problem that causes everything else.

Compliance cannot sit only with a manager, director, or administrator.

Negotiators, valuers, and progressors make compliance decisions every day through:

• what they say
• what they write
• what they record
• what they disclose
• what they leave out

If the culture is “just get the deal done”, compliance will always break.

How to avoid it

Make compliance part of service quality.

This is where the regulations for estate agents should be treated as a framework for building trust, not as a restriction on business.

Final thoughts: small mistakes create big risk

Most compliance mistakes don’t happen because someone intended to mislead. They happen because of pressure, inconsistency, or lack of training.

But in the property market, small errors can create big consequences.

The agencies that reduce complaints, avoid claims, and protect their reputation are the ones that do the basics exceptionally well:

• accurate property info
• clear disclosure
• documented advice
• consistent offer handling
• strong AML records
• ongoing staff training

That’s what modern compliance looks like. And it is one of the strongest competitive advantages an estate agency can build.