Four out of ten conveyancing firms have cut staff numbers because of the fall in home sales, according to a survey by search provider Searchflow published this week.

The poll, seen exclusively by the Gazette, revealed that 40% of firms have cut their headcount in response to the downturn, while 33% have put a freeze on recruitment. Searchflow surveyed 1,758 small and medium-sized firms across England and Wales at the beginning of September.

However, 30% of the respondents, who are all Searchflow customers, said they had no plans to realign their business models or cut staff, though some said they may not replace leavers.

David Kempster, Searchflow’s marketing manager, said: ‘It’s a scale issue. If you have a volume conveyancing model and are already trimmed back, you’ll have to make changes because of the slow market, but smaller firms don’t have such large overheads. The 30% who are doing nothing may have spread their risk wisely and diversified.’

Paul Marsh, Law Society President, agreed: ‘Those firms which are geared up to volume work have had to make tough decisions, but many smaller firms will not need to make such changes.’

However, Richard Barnett, chairman of the Law Society’s conveyancing and land law committee and senior partner at national volume firm Barnetts, said some firms were ‘risking disaster’ by burying their heads in the sand.

He said: ‘It’s staggering that if work’s fallen off by as much as a third, almost a third of firms have done nothing to change their business model. If they’re managing their business brilliantly, have good marketing and are bringing in work, that’s fantastic, but I doubt that is the case for all of those 30%.’

On the issue of the controversial home information packs (HIPs), 75% of respondents said they were not fit for purpose, but 56% believed they should be reformed rather than abandoned.

A government spokesman said HIPs were reducing the price of searches.