Understanding property mandates
Property mandates are the legal agreements between the homeowner and their estate agent, and they are commonly misunderstood when people are selling their homes.
When it comes to deciding between sole mandates and open mandates, there are plenty of factors that property owners need to consider.
In this blog post, we take a closer look at the pros and cons of different types of mandates.
Types of property mandates
With three types of mandates to choose from, it’s important to understand each one so that you can decide which option best matches your requirements.
You’ll have the option of open, multi-listing, and sole mandates when you’re selling your property.
If you want to sign agreements with numerous estate agents, open mandates are the best option.
- The estate agent who secures a sale on your home benefits from a commission while the other estate agents don’t receive a portion of the sale price. Therefore, the commission is not as high.
- It’s advisable to sign an agreement even if you are working with numerous estate agents as the amount of commission that you’re liable for is agreed to in writing as part of this document.
- While many sellers believe that this is the best option, there are also potential downsides to open mandates.
- Many agents put less effort into open mandates than they do when they are trying to sell properties with sole mandates. This is due to the fact that there is a risk that they will come away with no profit to show for their time if another agent sells the property first.
- Open mandates can become complicated if you are liaising with more than one agent with regards to purchasing the property.
- Arranging home viewing with numerous estate agents is more complex than working with one agent.
Multi-listing property mandates
This type of mandate means that you are dealing with an estate agent who has agreements with other agencies so that they can also list the details of your property.
- The main estate agent you’re dealing with will send your property details to member agencies giving you the benefit of multi-listings. The commission will be shared between the listing agent and the agent who secured the sale.
- Your property will get more exposure but there are also disadvantages to this type of agreement.
- Multi-listing property mandates may come with a higher commission percentage than the other types of agreements.
- The listing agent may spend less time selling your property as they know that there are other estate agents working on it.
A third option for is a sole mandate. These agreements mean that one agency is the exclusive seller of your property.
- Sole mandates create an image of exclusivity when you’re selling your home, which helps to secure a faster sale and a better price.
- You’ll have the convenience of only dealing with one estate agent.
- The estate agent receives the commission regardless of how the buyer came to know about the property meaning that the estate agent will receive their commission even if you find a buyer.
- You’ll be required to sign a contract with the estate agent for a specified period, which typically extends over three months. This means that you’ll also be obligated to use the services of the estate agent for the specified period of time.
This makes it important to find a reputable estate agent to work with who you know will do their job well. Some estate agents offer reduced commission for sole mandates.
Now that you know more about property mandates, you can choose the option that best matches your requirements. Visit GotProperty for more information and advice on property placement.