In This Guide
choosing an agent
1. Introduction
2. Cost
3. Terms and conditions
4. Valuation and price
5. Market reach
6. Regulation
7. Reputation
8. Standard of service
Conveyancing
Holding viewings
Negotiation
Planning your sale
Prepare your home
Seller's Packs
Selling at auction
Selling in Scotland
Selling privately
Selling your home
Using estate agents
choosing an agent
Terms and conditions
Print
Contents
Prev Page
Next Page
Before an agent will begin work, you will have to sign a contract or service agreement that sets out the terms and conditions under which the agent will act on your behalf. One of the most important aspects of the agreement relates to whether the agent operates as the only business trying to sell your property, or in conjunction or competition with other businesses:
An estate agent acting as a sole agency is acting alone in the
sale of your property. You are contractually bound not to allow
other agents to try and sell your property during the term of
the agreement and will be liable for a commission payment to the
sole agent should you do so and successfully sell the property.
Instructing a business as a sole agency should guarantee that the agent will work hard for the sale, as they know they will reap the full commission benefits. You may also get a reduction in commission, though this is often the standard rate that is otherwise inflated if you go for a joint or multiple selling rights. The main disadvantages of this approach are that you are putting all your eggs in one basket and restricting the potential customer base that has access to your property details.
Give the small print a thorough read and make sure that it is not conveying the agent sole selling rights. This differs from sole agency because it has no term attached. In other words, if the agent spends six months failing miserably to sell your home, then a passer by knocks on your door and makes you an offer, you will still have to pay commission if the agent has sole selling rights. This is obviously to be avoided at all costs.
This is where two agencies are working together to try and sell
your home. The main advantage is that there will be more than
one outlet or distribution channel for your property. There will
normally be some sort of synergy between the two sole agents.
It is fairly common to find a locally focused agent working in
tandem with a national chain to give a good blend of local and
national reach. It is unlikely that you will find two local or
two national agents working to these terms.
You may pay slightly more in total commission than you would if there were just a single sole agent, as both businesses will receive a share of the commission when the property is sold.
This is where you instruct a number of agencies working in competition
with each other. Each is acting fully autonomously and the person
or business that sells your property gets to keep the commission.
While some agents thrive off the competition, it can be the case
that the agent will spend less on marketing your property or act
less aggressively trying to sell your property under these terms.
This is because they are aware that there is a possibility that
they will receive zero commission regardless of how much effort
they put in, and so may focus their efforts on properties for
which they are the sole agents.
Most experienced observers would recommend that you opt for a sole agent. Not only does it generally mean a lower commission payment when the sale finally goes through, but many vendors find that buyers are more keen to buy when they know that the vendor is using a single agent. This is because the risk of the buyer being gazumped is minimised by the absence of other estate agents all hankering after the sale with scant regard for existing offers on the property.
Then again, if you are in a desperate hurry to sell your property, placing the property with multiple agents may be more likely to result in the right buyer being attracted more quickly. You will have to pay for this perk though, often as much as an extra one percent of commission.
Do not feel that you have to sign the agent's standard agreement
without making any alterations. Like most contracts, the points
can be negotiated, so if there is anything that you are particularly
uncomfortable with, you can bring it up with the agent.
One common area of contention is the contract duration. The standard term for which you are initially bound by the agreement is three months. There may also be a notice period on top of the initial agreement term. Obviously agents want to give themselves every opportunity possible to sell the property and pick up the commission. But it is in your interest to keep both the initial term and the notice period to a minimum, so that you can switch agents if you are not satisfied with the work that they have been doing. Twelve weeks may not seem like a lot, but if you quickly become dissatisfied, it is a long time to wait before you can change agent.
We would suggest negotiating a shorter period for sole agency, of approximately 6 weeks. This should give the agent enough time to find a buyer if they have valued the property accurately. If the property remains unsold after this time, then the sale can be opened up to other agents.
Prev Page
Next Page
Contents