One of the most misunderstood concepts in the process of selling a property is an exclusive or sole mandate.
Lanice Steward, head of training for Pam Golding Properties says it’s useful to know that an exclusive mandate is a formal instruction to an estate agentthat they have the exclusive right to sell a client’s property for a period of time, while a sole mandatealso allows the homeowner to sell the property in their private capacity.
“Some sellers believe that the more agents they have working on their property, the higher their chance of selling the property, quickly. The fact is, there is only one pool of buyers searching for property and if your property is priced correctly, the buyer will invariably end up with your chosen agent.”
Steward says a single partnership with the right agent provides the same level of commitment, risk and return on investment associated with any healthy business partnership, and provides peace of mind for the seller.
“It is more beneficial to the seller to have the buyers competing to offer the best market-related price, than it is to have agents competing to close the deal at any cost, often putting the seller’s price at risk.
“For a buyer, it is very off-putting to see the same property, advertised in the same online space, but with conflicting images, prices and details. It’s almost like launching a new product and allowing different sales teams to package, price and market it differently, leading to confusion in the marketplace.”
Besides that, she says buyers should be able to rest assured that the agent wants to close the deal as much as they do, but has an ethical obligation, as outlined by the Estate Agents Code of Conduct, to represent the correct market-related value with integrity.
“Unfortunately, some agents will over-value properties in order to get an exclusive mandate. If you have been presented with two or more radically different prices from agents, interrogate them on how they reached that price – because, usually, one of them is wrong.”
Find out how they obtained their market condition information, says Steward.
“Also, remember that there is an obligation for a buyer to use the first agent with whom they see a property, however, buyers go out with as many agents as they can. Regrettably, there are agents who will discourage a buyer who is keen on a property simply because they weren’t the first to show it to them.
“A professional agent will also know how to react and operate in markets where houses for sale are in high demand or over supply. You want the most knowledgeable and trustworthy professional to sell your valuable asset, someone with solid negotiation skills backed by facts and honesty.”
Steward adds: “Ask your potential agent if the company’s marketing decisions and methods are driven by data e.g. can they provide personalised knowledge about your property and area? Do they have in-depth strategies regarding today’s digital journey for marketing a property? Are their offices and agents connected through a referral system that might benefit you?”
Ideally, she says the exclusivity of the relationship allows the seller to hold the agent fully accountable for results and also, in the process, gives both parties the time to agree to any changes to the marketing and pricing strategy.