Agent Commission on a Private Sale

gab3x

Hi. My flat has been on the market for quite some time due to Covid. My agents are great but I might have found a buyer myself. I have a sole agency agreement with them.

If I arrange a sale privately by myself do I need to pay my agency a commission fee?

davidmcn

Probably, but we can't read your contract from here. You may have the option of ending the agreement and then waiting before progressing your sale, but still be prepared for arguments about exactly how the buyer found your property.

macman

No, but expect to be quizzed by your agent as to how exactly your buyer came to find the property and offer on it. You will probably be asked to pay for any external advertising that they have done on your behalf, for the EPC and floorplan etc. Refer to your contract.

GDB2222

It really does depend on what the contract says. 

eddddy

• Typically, a  'Sole Agency Agreement' means that you would only have to pay commission if the buyer was introduced by your EA or by another Agent. (So you don't have to pay a fee, if you find the buyer yourself.)

• Whereas a 'Sole Selling Rights Agreement' typically means that you have to pay commission however the seller was introduced.

But read your contract to check - some roguish EAs call their agreements 'Sole Agency' but when you read them they are more like 'Sole Selling Rights'.

• And some EAs have additional fees with names like "withdrawal fees" or "marketing fees" which you have to pay, even if the EA doesn't find a buyer.

(Some EAs will say that if your private buyer saw the EAs board, or saw the EAs advert on Rightmove etc, that means the EA introduced the buyer. But the courts have decided that is not the case.

As a result of the court ruling, the Property Ombudsman now says that an EA must do something like arrange a viewing in order to claim they introduced a buyer. )

theartfullodger

Was there a sign outside?  Did the person you "found" see the advert?

Do the decent thing, you know, traditional British values.

As it happens I'm in process of flogging a house, next door neighbour heard from exiting tenant and approached me direct but I've told agent if they buy I'll feel duty bound to pay normal fees (they've clearly done some work).  If agent refuses there's going to be a happy charity.

gab3x

theartfullodger said:

Was there a sign outside?  Did the person you "found" see the advert?

Do the decent thing, you know, traditional British values.

As it happens I'm in process of flogging a house, next door neighbour heard from exiting tenant and approached me direct but I've told agent if they buy I'll feel duty bound to pay normal fees (they've clearly done some work).  If agent refuses there's going to be a happy charity.

It's £7500 in question so not a small amount and I found the buyer through my house seller so totally on my own

eddddy

theartfullodger said:

Was there a sign outside?  Did the person you "found" see the advert?

Well... if you're suggesting that seeing a sign or an advert is an "introduction to the sale", the Court of Appeal disagrees.  See Foxtons Limited v Pelkey Bicknell [2008] EWCA Civ 419. 

theartfullodger said:

Do the decent thing, you know, traditional British values.

Presumably British Values would mean following the ruling of the UK Court of Appeal - that seeing a sign / advert isn't an introduction to the sale.

theartfullodger said:

As it happens I'm in process of flogging a house, next door neighbour heard from exiting tenant and approached me direct but I've told agent if they buy I'll feel duty bound to pay normal fees (they've clearly done some work).  

If agent refuses there's going to be a happy charity.

As business people, I'm sure your EA understand the risks of have 'sole agency agreements' and their clients finding private buyers.

But it's great that you want to support your local EA by making a voluntary payment to them. (But maybe there are others who are more in need of your voluntary payment than the EA.)