How to sell a house Estate agent contracts
It's important to read estate agent contracts thoroughly to make sure your agent will be provide the level of service you expect and what arrangements there are for if you're unhappy with your agent.
You should be very clear about the arrangement you're entering into, so the bottom line should is if you don't understand the contract, don't sign it.
Particular questions may want to ask when looking at the contract:
- What happens if you find a buyer for your house yourself, for example a work colleague, friend or neighbour?
- If you're not happy with the agent's service, how long does the contract tie you in for? Ideally aim for a six to 12-week break clause.
- What happens if you're unhappy with the agent's service and want to complain?
Know your rights: I don't want to use my estate agent anymore - how to end your contract with an estate agent
Estate agent contract terms
The type of estate agent contract you have will affect how much you pay in estate agent fees. When choosing your estate agent make sure you check what services they will include for your fee.
This means that the estate agent is the only agent with the right to sell your home during the term of the contract. The estate agent is entitled to payment, even if you find a buyer yourself. We recommend you don't sign a contract with sole selling rights.
Sole agency is the most common estate agent contract. This is the same as sole selling with the exception that, if you find a buyer yourself, you don’t have to pay the estate agent fees.
However, if sole agency contracts are open-ended, an agent can still claim commission if it introduced a buyer - even if the offer is made months (or potentially years) after the estate agent stopped marketing your property.
This means that several estate agents act for you, but only the agent that sells your property is entitled to receive a commission. The commission rate is usually higher for a multi-agency contract.
Ready, willing and able purchaser
If this clause is in your contract, don’t sign it. It means you’ll still have to pay the agent for finding a buyer even if your situation changes and you have to withdraw from the sale.
Terms of payment
Choose an agency that allows a few days for the money to transfer before charging interest. Never hand the authority to pay the estate agent over to anyone else, because you won’t have the power to withhold payment if you have a complaint.
This the period of time that you are tied into contract for, if you change agents during this time you will still be liable for paying their fees. The shortest contract you will typically be able to get is six weeks but try to avoid anything over eight weeks. Remember to factor in the notice period too (often around two weeks).
Your rights with estate agents
Legally, your estate agents contract must use clear terms. Your estate agent must pass on all offers promptly in writing, reveal any financial interest they have in offers made on your property, keep records for six years and be a member of one of the two Office of Fair Trading-approved redress schemes - the Property Ombudsman or Ombudsman Services: Property.
If you suspect that an agent has acted in breach of these regulations, contact your local authority trading standards department which has a duty to investigate and take enforcement action.
It’s a good idea to keep details records of your dealings with your estate agent, in case problems arise.
Know your rights: I think my estate agent's fees are too high - what action can you take if you think you are being overcharged
Need mortgage advice?
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