In the UK there are more regulations around flipping a burger than relate to how properties are sold. Estate agents are not required to have professional qualifications and they are regulated by a system that favours the agents hence the low reputation of agents.
Instructing an Estate Agent
- Never forget you are the instructing party. You do not have to sign the contract you are offered so read it through and watch for terms that bind you and not them.
A. In the 1980’s it was common place for contracts to state you have to pay their fee in the event of ‘our introducing a purchaser who is ready, willing and able to complete the transaction’.
You only want to pay a fee on Exchange if the deposit has been paid “As agent”, the fact that someone purports to have been able to proceed to completion is probably not good enough. You could be exposed to needless cost.
Be sure to use a “reservation agreement” to lock in the buyer. - Dual Fee exposure
A. Some agents still expect to be paid even if they did not introduce the buyer, this can be done by claiming they have influenced a purchase or just stating they expect to be paid even if they do not introduce the buyer! This letter from Which may help you refute a claim.
B. When you take on an estate agent make it clear you will not accept any risk of dual fees and have them include in the agreement a “Winner takes all” clause, i.e. they only get paid if they find the buyer. If two agents then argue over this it’s for them to reach an agreement with each other. - Do not accept unreasonable terms
A. Unreasonable is probably anything you consider to be unreasonable. If in doubt do not sign any agreement. A reasonable estate agent will want you to be happy. - Read the contract and cross out everything you don’t like. It’s your property.
- It is reasonable for an agent to have a clause that covers them in the event that a person they did introduce subsequently buys your property within a reasonable period – have that period clearly defined in the agreement.
- Watch out for the agent who expects you to take risks that feel uncomfortable such as incurring additional costs or cancelling planned events without seeing comparable commitment from the buyer.