select
|

Sole mandate or shared mandate: which one is best?

Should you just contract one real estate agency to help you with marketing and managing the sale of your property ? which is known as a sole mandate ? or is it better to enlist the services of multiple agents or agencies instead?  There are obviously pros and cons to each approach and you’ll need to do your homework before deciding on the best tactic.

According to a Money Web article, the way you choose to sell your property will affect the fees you pay and the final price you receive, so it is important to understand the implications of each type of mandate, whether this is sole, joint or open. It’s also crucial to read through the terms of any mandate before signing. These terms should include the time period of your contract with an agency (this can be anything from one to three months or more), the attorney you’ll use (you’re not actually obliged to use the attorney linked to the agency) and the commission rate you’ll pay the agency after the sale.

The benefits of a sole mandate


The role of a Property Professional is to introduce your property to the right market to increase the likelihood of a sale. They also assist on all matters property related, whether this is a valuation on your property, property advice, talking you through the transfer process or assisting with your pre-qualification. What’s apparent from the onset is that, unless you are good at juggling multiple information sources at once, having more than one agency or property professional helping you through the process might become more confusing or time consuming than it’s worth.

According to Shaun Dubois, a Pietermaritzburg-based, Just Property Franchisee, a sole mandate should assure a seller that their best interests will be looked out for. 

"A sole mandate allows us to allocate far more advertising budget to the sale, as we know we can take that risk because we will sell the property," says Dubois. 

"Instead of just any agents ? some of which the seller may not know or even trust ? trying to get the property as cheap as possible for their clients, we can look after the seller's interests and assist them in securing as high a price as possible," he adds.

The following are some additional reasons for considering a sole mandate:

Streamlined communication (there’s only one point of contact for all feedback and information).
 
One personalised marketing plan (your agent needs pull out all the stops if they are solely responsible for marketing and selling your property).
 
Increased security and reduced admin (only one agent needs access to your property on show days, with only their appointment dates needing to be accommodated).
 
Exclusivity (choosing one reputable agency to sell a property gives it a more exclusive and professional feel, more so than having multiple ‘For Sale’ signs cluttering your sidewalk).

Dubois also points to a recent court case, that went as far as the Supreme Court of Appeal, in which one agency successfully sued an owner for payment of double commission. “Had the owner elected to use only one company, under a sole or exclusive mandate, they would have been protected from this risk,” says Dubois.
 
Shared or open mandates


An open mandate means that you don’t have to sign a fixed-period contract with any agency and can approach many agencies to market your property for you. The agent that then secures a sale is the one who gets the commission off that sale. This could appeal to a seller who wants to ensure their property is being marketed as widely as possible.

Whether this type of mandate results in better marketing efforts from each agent, however, will be up to the agencies involved.  An open mandate could be less of an incentive for an agent marketing your property, as there are no guarantees of their earning commission at the end of the day. Alternatively, adding a competitive edge to the mix could increase their efforts to ensure they make the sale.

A shared or joint mandate means that two or more agents from one agency are assigned to marketing and selling your property. These property professionals will then decide how to allocate responsibilities between themselves and the percentage of commission they are each to earn on completing of the sale. The amicability and success of such a contract really depends on how well agents work together and how fair they perceive the process to be.  


  Comment on this Article

  Please login to post comments

Post to my facebook wall
  
2000
Characters remaining


    Latest Property News
    • 17 Nov 2017
      FWJK has announced the launch of its latest residential brand, the Lil’ Apple, which will be launched simultaneously in two developments in Cape Town and Umhlanga totaling 600 apartments. The Lil’ Apple is set to be a brand of FWJK’s New York style apartments which will be rolled out nationally.
    • 17 Nov 2017
      It’s been a tumultuous year on many fronts, with socio-political uncertainty setting the tone for much of South Africa’s economic activity yet despite this and seemingly counter-intuitively, the residential property market has held up well.
    • 17 Nov 2017
      The EAAB (the Estate Agency Affairs Board) recently claimed that around 50,000 illegal estate agents could currently be operating illegally.
    • 16 Nov 2017
      Penthouses are synonymous with New York – characterised by high-rise living that is decidedly luxurious and spacious. While exclusivity comes at a price, you can still create a “penthouse” look and feel in your existing apartment or even the upstairs bedroom of a double storey house with some clever design changes and styling touches.
    • 16 Nov 2017
      The area has long been popular with kite surfers and, with escalating property prices in Cape Town itself, is increasingly in demand with home owners who work in town, but are looking to invest in more affordable properties.
    • 16 Nov 2017
      Cape Town’s popularity as a world-class tourist destination has resulted in a spike in the number of homes available for holiday lets and fuelled investor demand for sectional title units with short term rental potential.
    • 15 Nov 2017
      Sappi, one of South Africa’s oldest global companies and a leading global supplier of sustainable woodfibre products, has moved its global and regional headquarters to a new site on the corner of Oxford and 14th Avenue in Rosebank.
    • 15 Nov 2017
      There’s an old saying in real estate that you should seek to make a profit when you buy, not only when you sell – and a large part of succeeding at that endeavour is buying a home in an area with desirable features that will enhance the resale value of your property.
        
    X
    Subscribe to the MyProperty Newsletter

    Name  
    Last Name  
    Email Address  
    Email Frequency
    select
    X
    Share this Page

       
    For Sale Property
    Rental Property
    More Options
    About
    Connect with us
    FEEDBACK