Information regarding fees payable to Estate Agents under a Sole Agency Agreement
Definition of Sole Agency & Sole Selling Rights
Extract from pdf on Office of Fair Trading Web site
The estate agent you appoint is the only agent with the right to sell your property. As you are not an agent, if you find a buyer yourself [for example by placing an advert in a newspaper or on a web site such as Smallholding Wales] you don’t have to pay the estate agent’s commission. You may still have to pay for advertising or a ‘For Sale’ board.
Sole selling rights
The estate agent is the only person with the right to sell your property. It differs from sole agency in that if you find a buyer yourself, you still have to pay the estate agent [so suggest to the agent that he pays for your listing on Smallholding Wales!]
Definition of Estate Agency Work
Extract from Office of Fair Trading web site
Under section 1 of the Estate Agents Act 1979, the legal definition of what constitutes estate agency work is very wide and even if you don't call yourself an estate agent you may be seen to be one in law when you do certain things. Subject to certain limited exceptions you will be engaging in estate agency work if, in the course of business and acting on instructions from a third party (your client) who wishes to either buy or sell property (an interest in land), you do either (or both) of the following:
(1) things for the purpose of, or with a view to, effecting the introduction to your client, of someone who either wishes to buy or sell property
(2) things after such an introduction has been made by you to secure the sale or purchase of the property.
The law also only requires you to do things for the purpose of, or with a view to introducing your client to a buyer or seller in order for you to be acting as an estate agent. It is not necessary for you to actually introduce your client to a buyer or seller in order to fall within the legal definition of estate agency work.
If you are merely 'publishing advertisements or disseminating information' then you will not be acting as an estate agent. However, this exemption is a very narrow one.
Activities of those acting as estate agents
Below is a non-exhaustive list of examples of the types of activities typically carried out by property retailers that we consider would take them beyond the exemption of merely publishing advertisements or disseminating information. If you engage in such activities, you will be, or are likely to be, engaging in estate agency work:
* sending out property particulars and arranging viewings
* receiving and fielding queries from potential sellers or buyers and passing on details to your clients
* providing clients with a 'For Sale' board and/or putting it up outside their property where the board contains your contact details.
The above confirms that Smallholding Wales is not an Estate Agent since :
- we do not send out property particulars
- we do not arrange viewings
- we do not receive or field queries and pass them on to our clients
- we do not provide a 'For Sale' board
Therefore, if you sell your property via word of mouth, or through an advert in a newspaper or on a website (providing the website is NOT an estate agent, see above) and you have a Sole Agency (or Multiple Agency) agreement with an estate agent(s), then you do not have to pay any fees to the estate agent (as long as you have not agreed that the agent has sole selling rights).