SOLE MANDATE: Beware, Risk of Double Commission

The Risk of Paying Double Commission

When a seller gives more than one estate agent the right to market the same property (this is called an open mandate), the seller risks having to pay double commission.

There have been many court cases where judges ordered sellers to pay more than one commission. The courts often say that the seller is to blame for giving multiple agents the same job.

Here is how this problem happens:

• Buyers often speak to more than one agent when looking for property in a certain area.
• The same buyer may view the same property through two or more different agents.
• If that buyer decides to buy the property, more than one agent may claim they are owed commission - one for showing the house first, and another for closing the deal.
• Unless the agents agree to share the commission (which does not always happen), the seller may have to pay both.

This problem happens more often than people think.

Legally, the agent who closes the deal is usually owed commission. But another agent might also have a legal right if they introduced the buyer, or even the buyer's spouse, friend, or relative, to the property.

More Agents = Lower Selling Price

• Just like any other product, if there are too many "for sale" signs outside one house, buyers may think something is wrong with the property.
• This often leads them to offer less.
• When too many agents are marketing one property, it can actually reduce the property's value in the eyes of buyers.

Commitment Works Both Ways

Marketing a property costs the agent money.

They pay for:

• Advertising
• Office and admin costs
• Petrol
• Time and effort

Agents take on these costs without any guarantee that they will get paid.

If you want your agent to give 100% effort, you should show the same commitment. Signing a sole mandate gives the agent peace of mind to know that their time and effort will not be wasted.

You, as the seller, also benefit. You know the agent is fully focused on selling your property and not splitting their time or resources.

This is a fair agreement: the agent works hard to find a buyer, and you agree to give that agent the exclusive right to sell for a set period.

A Word of Warning

A sole mandate with one trusted agent helps avoid confusion, conflict, and extra legal costs.

Often, agents who accept open mandates are less experienced or under pressure to take on risky agreements. In contrast, professional and successful agencies that understand the market usually only work with sole mandates or exclusive listing agreements.

They want to give you 100% of their time and energy - but only if they know their effort will be rewarded.

Final Advice

We strongly encourage you to sign a sole mandate with the estate agent who has given you this brochure. It protects you from double commission, increases your chances of getting a better price, and ensures full commitment from a professional agent.