Estate agents contracts should be treated with care.
Your estate agent doesn’t have to be registered to practice. But many are bound by a volantry code of practice through membership of the National Association of Estate Agents (NAEA) and the Ombudsman for Estate Agents (OEA).
The OEA which represents around two thirds of estate agents launched a revised code of practice on 1 October 2006. The Code is available to download
at the OEA website.
The strengthened code aims to make the buying and selling process more transparent and increase consumer protection. Specifically, the revised code requires member firms to be clearer on charges and to make more information available to house hunters.
Estate agents' contracts – overview
Some house sellers only scutinise their agency contract if they want out or have a grievance. Don't be one of them.
Estate agents' agreements are legally binding documents. So like all legally binding documents it’s worth reading carefully. Don’t take the contents for granted - take legal advice if you think you need it.
Before signing, read the contract carefully and make sure you understand it. Do you:
have the right to cancel the contract
know how long it will run
understand the implications of any unfamiliar terms such as ‘sole agency’
As we have said elsewhere avoid estate agents contracts tying you to your agent for a very long time. Also watch out for agency jargon you are unfamilar with as estate agents' contracts can contain quite restrictive clauses. These are not bad in themselves, but you need to make sure you understand precisely what you are getting into.
Individual estate agents tend to treat their contracts in different ways. Some will hold you to the nth' letter of the agreement, others will be more flexible. In part it probably depends on the state of the local property market but mainly on the quality the relationship you foster with your agent.
We estimate about one in twenty vendors selling through estate agents are under some form of pressure to sell. If this applies to you, be quite open and honest with your agent.
Estate agents contracts are there for a reason, but estate agents are human too. Many will be sympathetic if you find yourself in a bit of a jam.