The Estate Agency Affairs Board has a Code of Conduct, I explain the main points of how you should be treated according to them.
The first thing you should always do is “Get it in writing”. Remember Sam Goldwyn’s famous statement “A verbal contract isn’t worth the paper it’s written on.
Whenever anyone, one of my agents or a client approaches me regarding a transfer or offer problem my immediate reaction is
“What does the paperwork say?” So make sure everything of importance is in writing and forms part of any agreement that is binding.
The second thing this is make sure you understand what is written and it says what you want it to say. Don’t fall for “It’s got to be like that.” Get a plain language explanation as part of the contract. In the event of a dispute all parties and the court will understand the plain language.
Many people think that if you haven’t signed anything you haven’t given a MANDATE. Not so, you can give a VERBAL MANDATE but not a VERBAL SOLE MANDATE.
If you give an OK to “May we bring you an offer for your property” you’ve given a verbal mandate. They may advertise and market it.
Beware an agent promising a higher price than anyone else if you sign a sole mandate. Often this is just to block you from feedback from the market and after a few months, when you are desperate, they bring you an offer for a price that you could have gotten months ago.
Also, he or she must do whatever they reasonably can to protect the interests of both parties. I’ve seen offers where the main part of the document is about the agencies and their rights. Perfectly legal, but it makes you wonder where their priorities are.
No agent may legally offer a property for sale unless they have been given a mandate of some sort to do so. Some agencies work together and share listings. They should tell you if they’re going to do this and get your permission but they don’t always and sometimes there isn’t time, they have a hot prospect and don’t have a suitable property so they as a colleague who has. They share the mandate.
There is no such thing as a VERBAL SOLE MANDATE. Any agent who tries to tell you he has one or you’ve given him one is committing fraud.
A sole mandate must have an expiry date. Make sure yours has. No date and it’s invalid and an attempt to commit fraud or at the least very sloppy service. Either way an agency to avoid like the plague.
No tricky automatic renewals hidden in the fine print. If you wish to give an extension you must be aware that you are doing so and sign for it.
No clauses giving power of attorney hidden in the print. Read before you sign. Ask for an explanation. If you’re not happy, have it rewritten or walk away or consult your attorney.
An agent mustn’t give you an inflated or lower than real market value. However opinions differ. Get it in writing and get supporting evidence. A Comparative Market Analysis is best, get at least three comparable properties that were recently sold, three currently on the market and for good measure what would the replacement cost of your building be.
An agent must also have knowledge of the type of property he is selling. It’s no good employing someone to negotiate a specialised form of property unless they are qualified and experience to do so.
What’s more they should tell you (in writing) what they are going to do to market your property, get them to report on this and if they fail to keep their promise, cancel the mandate.
Also find out who you’re really dealing with. Just because the name on the window is a national brand doesn’t mean the franchisee isn’t inexperienced and newly qualified. Some characters just go through franchises. They get kicked out of one and next week they’re representing another big name or just trading under another name. Ask for references that you can check, regarding the agent or franchisee.
If they tell you they have an offer it must be in writing and must be produced. Otherwise the best they can have is someone who would like to make an offer. Get it in writing.
If they want to put up a for sale board they must get your permission in writing. An email will suffice.
No agent can change any offer before the seller has seen it.
The agent must explain every implication of the offer or if it requires specialised legal, financial, tax or other knowledge refer you to someone who can.
Bottom line is that the agent must put the seller (usually their client) and the buyer first. Even at the risk of their own interest. That’s called service and that’s what they provide.
Most estate agents are honest, some are excellent and a few are shady. Follow these guidelines and avoid the few.