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Appointing an Estate Agent to Sell Your Property

Wednesday, March 28, 2018


When buying or selling property, there is no doubt that you will need professional assistance to conclude a successful deal. As in most industries, there are good and poor professionals... in the property industry too. The majority, however, are reputable professionals who aim to do the best job possible. Whilst the seller is technically the estate agent's client, a good agent will provide value to the seller as well as the buyer and conclude a deal which is mutually beneficial.

 

It is wise to establish which estate agents are active in your particular suburb. They are likely to have a list of potential buyers for that area. They will also have a good idea of market related property values.

 

Reputation is important as well as actually meeting with the individual agent who will be responsible for the sale of your property, before you make your decision. An estate agent's knowledge of the home buying process and the local market is key. You will get an idea of the agent's competencies by asking a few key questions, like the length of time they have been in the industry and questions around the law pertaining to property transactions.

 

Ask to see proof of the agent's Fidelity Fund Certificate, issued by the Estate Agency Affairs Board. If the agent holds a Fidelity Fun Certificate, it means that, amongst other things, the agent is serious about his profession and that he should comply with the conduct rules stipulated in the Estate Agent's Code of Conduct. An agent will ask questions regarding your needs. A professional agent will also give you advice on preparing your property for sale, what repairs need to be done, and how much you should spend. Listen to what an agent has to say as this will aid in selling your property and getting fair value. You want to make your property ready for sale without over capitalising it.

 

A good agent will suggest a selling price of your home at a marketable level. Ask the agent to substantiate this value by giving you comparative prices of recently sold homes in your area. Be wary of an over-inflated or under-valued price. The agent might be trying to impress you with a high evaluation to elicit a sole mandate. On the other hand, they might give a low evaluation to make a quick sale.

 

It is your right to negotiate the estate agent's commission, although please remember that this is an agent's income and when you want to pay as little as possible for a professional service, chances are that you will not receive a full service.

 

If you realise that two different estate agents have introduced the same potential buyer to your property, let the estate agents know immediately. If the buyer purchases your property through the second estate agent, you may be liable to pay double commission, because the first estate agent can claim the full commission amount as well.

 

Agencies normally make promises to advertise your property, in various publications, online, in their shop windows, on For Sale signs, and by doing show-houses. Make sure that you get these promises in writing before appointing an agent, particularly if you are giving them a sole mandate or sole selling right.

 

What Role Does The Estate Agent Play?

There are estate agents who specialise in selling or letting commercial, industrial or agricultural properties, however, in Property Power, we only focus on estate agents who specialise in residential property sales and letting.

 

The estate agent is the link between a seller and buyer, who will negotiate an agreement of sale acceptable to both parties. An Offer to Purchase is drafted by the estate agent, which must be signed by the buyer, seller and estate agent.

 

For his service, the estate agent charges a fee or commission, which is paid by the seller. The commission payable is negotiable and must be discussed with the estate agent at the commencement of the transaction. The commission is usually calculated as a percentage of the selling price.

 

What are the Benefits of Using an Estate Agent?

  • An estate agent will know how to deal with the legal, financial and marketing issues in the appropriate manner.
  • He will also have knowledge of different sales techniques, financing alternatives, valuation methods, construction practices and relevant property laws and regulations.
  • He will be familiar with the local property market, understand consumer behaviour and be able to communicate with people at different levels.
  • The estate agent will protect the interest of his client to the best of his ability with due regard to the interest of all other parties concerned.
  • Buying property is probably the biggest investment you will ever make. The estate agent plays a vital role in ensuring the security of your big investment.
  • Estate agents registered with the Estate Agency Affairs Board are governed by a code of conduct, Common Law, as well as certain provisions of the Estate Agency Affairs Act, which are enforceable by means of disciplinary action by the Estate Agency Affairs Board.

 

 

Obligations of the Estate Agent

In Terms of a Prospective Buyer (or Lessee)...

  • Acting honestly and with fair conduct.
  • Qualifying the buyer, i.e. obtaining information about the buyer in order to introduce him to the ideal home.
  • Showing selected properties to the buyer.
  • Maintaining contact with the prospective buyer.
  • Assisting the buyer to make an offer.
  • Assisting the buyer to obtain finance.
  • After-sales service.
  • Complying at all times with the legal and ethical obligations owed to a prospective buyer, regulated by the Estate Agency Affairs Board, i.e.:
    - The duty not to make a misrepresentation,
    - The obligation to disclose material facts,
    - The duty not to prejudice the interest of the buyer,
    - The obligation to be ethical regarding the receipt of trust money,
    - The duty not to abuse or unlawfully disclose confidential information.

 

In Terms of a Seller (or Lessor)...

Generally, an estate agent's client is a seller or lessor of a property. The estate agent's function is to introduce a willing and able buyer/lessee to his client's property, but he also guides a seller through the selling process by:

  • Advising him on the market value of his property;
  • Marketing his property effectively;
  • Assessing prospective purchasers to ascertain whether they are financially able to purchase his property and what their housing needs are;
  • Advising a prospective purchaser on the suitability of the property for his needs, its general conditions and whether there are any restrictions on the use of thew property;
  • Negotiating the transaction, taking into consideration the interests of all parties concerned;
  • Completing the Offer to Purchase document, making sure that the document is legally valid and reflects the requirements and intentions of all the parties concerned;
  • Advising the buyer on financing the transaction and assisting him in arranging such finance;
  • Liaising with the conveyancing attorneys attending to the transfer of the property and assisting them to expedite the registration process.