Whozoo tips #32 - My commercial estate agent wants me to sign terms, this makes me nervous - is this ok?

Published: 03/02/2024

It is common and standard practice for commercial estate agents to ask property owners to sign terms of engagement or agency agreements before initiating the process of selling a commercial property. These documents outline the terms and conditions of the agreement between you (the property owner) and the estate agent. While it's generally safe and customary, it's essential to review the terms carefully and, if needed, seek legal advice to ensure that you fully understand the terms before signing.

Here are some key points to consider:

Commission and Fees:
•Check the commission structure and any additional fees outlined in the agreement. Ensure that the rates are clear, and you understand how the estate agent will be compensated upon a successful sale.

Duration of Agreement:
•Look for information about the duration of the agency agreement. Some agreements have a fixed term, while others may allow for termination with notice. Understand the implications if you decide to switch agents or withdraw your property from the market before the agreement expires.

•Determine whether the agreement grants exclusivity to the estate agent. Exclusivity means that only the appointed agent has the right to market and sell the property within a specified period. If exclusivity is granted, understand the terms and conditions.

Marketing Plan:

•The agreement may outline the marketing plan and activities that the estate agent will undertake to promote your property. Ensure that the proposed marketing strategy aligns with your expectations and needs.

Termination Clauses:

•Review any clauses related to termination of the agreement. Understand the circumstances under which either party can terminate the agreement and any associated penalties or costs.

Dispute Resolution:
•Check for provisions related to dispute resolution in case any disagreements arise during the course of the agency agreement.

Responsibilities of Both Parties:
•Understand the responsibilities and obligations of both you and the estate agent. This may include providing necessary documentation, property access, and cooperation during the sales process.

Legal Review:
•If you have any concerns or are uncertain about certain terms, consider seeking legal advice before signing the agreement. A solicitor can provide guidance and help ensure that your interests are protected.

Remember that agency agreements are legally binding contracts, so it's crucial to read and understand the terms thoroughly before signing. If you have any questions or if there are specific provisions you'd like to discuss or negotiate, communicate openly with the estate agent or seek legal advice for clarification.