The terms of an estate agent mandate

One of the most important purposes of signing an estate agent mandate is to create a binding agreement between the estate agent and the seller that sets out the terms of the arrangement agreed upon to market and sell the property.

Property Blog Articles | Advice | Contractual Matters | Market News

This contract helps eliminate any unnecessary confusion as the mandate clearly stipulates the terms agreed upfront by both seller and agent. It establishes the commitment between the agent and the seller and compels the agent to provide his or her best efforts to sell the property in question. Depending on the terms of the mandate, the agent will also most likely provide regular activity reports, keeping all parties informed of any new developments.

The information included in a mandate

Depending on the type of mandate agreed upon between the parties involved, a mandate would usually specify the following information:

  • The duration of the mandate;
  • The purchase price;
  • The specific terms and conditions of the mandate;
  • The instruction to render a specific service in respect of the particular property, and
  • An arrangement on the payment of the estate agents commission

The types of mandates

Sole mandate: A sole mandate is where one estate agent is given exclusive rights to market and sell the owner’s immovable property. This type of mandate protects the seller from a double commission claim and allows a clear and strategic plan to be put in place for the marketing and exposure of the property. A sole mandate also provides for greater security, privacy and protection for the property as access to the property is controlled by one agent, making arrange suitable viewing times simpler.

Joint mandate: In this case, the rights to selling a property are entrusted to more than one agent at different agencies. With more than one agent marketing the property, there is likely to be greater exposure of the property on the market, increasing the chances of finding a suitable buyer quicker. The commission paid on the sale of the property is split between the agents, regardless of who sells the property based on the agreed terms of the mandate, meaning that there is no extra cost to the seller. While there are notable benefits to this type of mandate, it is important to ensure that the efforts of all estate agents involved are well coordinated and that there is good communication to give the best chance of success.

Open Mandate: An open mandate allows the seller to work with multiple agents without restriction and offers the advantage of not being ‘locked in’ through a contract with specific agents. However, the risks of uncoordinated or duplicated efforts need to be managed carefully to ensure the greater marketing exposure is harnessed effectively.

Choosing the right kind of mandate for you will depend on the particular situation surrounding the property sale, but understanding what benefits and risks are associated with each can go a long way to making an informed decision.

Follow Snymans on Facebook for more legal information, tips and news about property.

5512

Recommended for you

Snymans Attorneys | Residential and Commercial Property Transfers
Contractual Matters

How to ensure a quick and smooth property transfer

4107

There will always be elements in a property transaction that will be out of your control as the purchaser or seller, however some elements can be managed in a way as to avoid unnecessary delays.

Read More
What Happens To The Ownership Of My Property When I Get Married
Contractual Matters

Marriage in or out of community of property?

4439

The marital regime selected at the time of entering into a marriage will have a significant impact on how ownership of property is dealt with within the marriage, which is why it is important to understand the different options available and select the one that best suits you.

Read More
Property Transfers | Bond Registrations | Snymans Attorneys
Contractual Matters

Minors and immovable property

4003

While the process for transferring ownership of immovable property remains largely the same in cases where one of the parties to the transfer is a minor, the minor’s contractual capacity must be carefully considered.

Read More
Property Blog Articles | Advice | Contractual Matters | Market News
Contractual Matters

Cash is king – what you need to know as a cash buyer

7063

The general sentiment is that a cash purchase is always a better option when buying property. However there are many factors to be considered before putting pen to paper.

Read More
Property Blog Articles | Advice | Contractual Matters | Market News
Contractual Matters

Always look under the rug

6960

While a property seller is legally required to disclose any known defects of the property, what can a buyer expect when it comes to unusual characteristics, quirks or abnormal qualities?

Read More

Need more Snymans content?

Sign up for our monthly newsletter.

The terms of an estate agent mandate

One of the most important purposes of signing an estate agent mandate is to create a binding agreement between the estate agent and the seller that sets out the terms of the arrangement agreed upon to market and sell the property.

Property Blog Articles | Advice | Contractual Matters | Market News

This contract helps eliminate any unnecessary confusion as the mandate clearly stipulates the terms agreed upfront by both seller and agent. It establishes the commitment between the agent and the seller and compels the agent to provide his or her best efforts to sell the property in question. Depending on the terms of the mandate, the agent will also most likely provide regular activity reports, keeping all parties informed of any new developments.

The information included in a mandate

Depending on the type of mandate agreed upon between the parties involved, a mandate would usually specify the following information:

  • The duration of the mandate;
  • The purchase price;
  • The specific terms and conditions of the mandate;
  • The instruction to render a specific service in respect of the particular property, and
  • An arrangement on the payment of the estate agents commission

The types of mandates

Sole mandate: A sole mandate is where one estate agent is given exclusive rights to market and sell the owner’s immovable property. This type of mandate protects the seller from a double commission claim and allows a clear and strategic plan to be put in place for the marketing and exposure of the property. A sole mandate also provides for greater security, privacy and protection for the property as access to the property is controlled by one agent, making arrange suitable viewing times simpler.

Joint mandate: In this case, the rights to selling a property are entrusted to more than one agent at different agencies. With more than one agent marketing the property, there is likely to be greater exposure of the property on the market, increasing the chances of finding a suitable buyer quicker. The commission paid on the sale of the property is split between the agents, regardless of who sells the property based on the agreed terms of the mandate, meaning that there is no extra cost to the seller. While there are notable benefits to this type of mandate, it is important to ensure that the efforts of all estate agents involved are well coordinated and that there is good communication to give the best chance of success.

Open Mandate: An open mandate allows the seller to work with multiple agents without restriction and offers the advantage of not being ‘locked in’ through a contract with specific agents. However, the risks of uncoordinated or duplicated efforts need to be managed carefully to ensure the greater marketing exposure is harnessed effectively.

Choosing the right kind of mandate for you will depend on the particular situation surrounding the property sale, but understanding what benefits and risks are associated with each can go a long way to making an informed decision.

Follow Snymans on Facebook for more legal information, tips and news about property.

5512