Estate Agent Fees

upthemanor1

Hi everyone.  Thanks for reading.

I'm currently in the process of selling a house and I agreed a sale back in August 2022.  Unfortunately, the sale has still not even reached the 'exchanged contracts' stage and I feel I've given the purchaser enough time to complete.  With this in mind I want to relist the property but this time with a 'dual agency' contract to ensure that the agents are showing around new, potential purchasers rather than just sit out the original offer in the hope it completes.

However, the original agent has now stated that should I find a buyer with another agent I will still be liable for their costs (about £5k so not an insignificant amount) as their buyer is still progressing and it would be me that withdraws from the potential sale.

My question is this; what is a reasonable amount of time that an agent can claim a buyer is 'still progressing'?

I should say that I have had no issues whatsoever with the original agent; they've pushed for the sale to go through as much as they possibly could.  I just want to get the house sold and give myself as much possibility of this happening.

Thanks for any advice received.

TBagpuss

It depends on the terms of your agreement but it may be that you need to get your solicitor to give the buyer a deadline and then make clear to the agent that the buyer is not proceedable.
It may depend a little on the reasons for the delay. 

propertyrental

Identify the reason for the delay. If the buyer is 'not proceedable' eg mortgage application denied, sale of their current property stalled etc then you can give the buyer a (2 week? deadline to Exchange and then withdraw.

Make sure you serve the proper notice on your current agent (read your contract), and also ask for a list of all the prospective buyers they have introduced. In writing. Give this to the new agent to avoid any double fees if one of the original buyers returns via the new agent.

eddddy

It sounds like you have a "Ready, Willing and Able Purchaser" clause (or similar) in your contract with your Estate Agent. I always try to avoid contracts like that, because they cause the type of argument that you're having.


If the contract includes the specific phrase "Ready, Willing and Able Purchaser", the law defines what it means:

“READY, WILLING AND ABLE PURCHASER

A purchaser is a “ready, willing and able” purchaser if he is prepared and is able to [exchange unconditional contracts for the purchase of your property].

You will be liable to pay remuneration to us, in addition to any other costs or charges agreed, if such a purchaser is introduced by us in accordance with your instructions and this must be paid even if you subsequently withdraw and [unconditional contracts for sale are not exchanged], irrespective of your reasons.”

link: https://www.legislation.gov.uk/uksi/1991/859/schedule/made

So you can argue that your buyer isn't prepared and able to exchange. But Estate Agents will often ignore that argument, and threaten to sue you anyway. (In my opinion, it's probably a scare tactic.)

You could probably defuse the argument by saying you'll let the current sale progress, but you want your current agent to start remarketing the property.

But what makes it difficult is that you want to change to a Joint Agency agreement - Estate Agents aren't keen on that. You'd have to give your agent the contractual written notice for your sole agency agreement. And they might continue their threats to sue you.

saajan_12

upthemanor1 said:

Hi everyone.  Thanks for reading.

I'm currently in the process of selling a house and I agreed a sale back in August 2022.  Unfortunately, the sale has still not even reached the 'exchanged contracts' stage and I feel I've given the purchaser enough time to complete.  - well what have the delays been? Some things might be the buyer's side, some might be the response times from your solicitor / other information providers linked to the property. 
With this in mind I want to relist the property but this time with a 'dual agency' contract to ensure that the agents are showing around new, potential purchasers rather than just sit out the original offer in the hope it completes. - how do you know that any new purchaser wouldn't also be as slow (eg if the delay is partly the response time of parties related to the property)? Also if this purchaser gets spooked that you're pulling out, they may stop or look elsewhere too. 

However, the original agent has now stated that should I find a buyer with another agent I will still be liable for their costs (about £5k so not an insignificant amount) as their buyer is still progressing and it would be me that withdraws from the potential sale. - this depends entirely on your contract with them - is the fee due upon exchange, or by them finding a 'ready, willing and able' buyer? Also do you have sole selling / sole agency / multi agent contract? 

My question is this; what is a reasonable amount of time that an agent can claim a buyer is 'still progressing'? - there's no universal rule, but it may be irrelevant depending on the above. 

I should say that I have had no issues whatsoever with the original agent; they've pushed for the sale to go through as much as they possibly could.  I just want to get the house sold and give myself as much possibility of this happening.

Thanks for any advice received.

Dig your contract out and read / quote it here. Until then, anything is guesswork. 

upthemanor1

Many thanks for all of your responses.  They are all really helpful and massively appreciated.  I do have a "Ready, Willing and Able Purchaser" clause.  I did give a two week deadline to the buyer and this has now passed.  

The delay is apparently further down the chain where someone was gifted some cash and it's been referred to the lender's compliance team.  They seem in absolutely no rush to do anything to progress it.  It all sounds rather odd.

The new agent has agreed to a Joint Agency Agreement and I'm happy for that to happen but with the offer to continue to sell with the current agent to current purchaser if they can (or indeed with a new buyer).  If they are unhappy with that then I think I'll serve notice on the current agent with a view that they are playing 'scare tactics' and won't progress with litigation.

Thanks again for all of your help.

Slinky

We had a sole agency with an agent who found us a buyer who subsequently pulled out. We'd already moved out of the property by this point, so decided to appoint a second agent and told the first one we'd only pay them the sole agency rate even though it was dual agency. They accepted this as 1% of a sale is better than 1.5% (or whatever it was) of nothing if we served them notice. The second agent was happy to accept the same fee as the original since it gave them a chance of a sale they weren't expecting. As it turns out the original agent found us another buyer who paid more than we'd agreed with the first one.

AskAsk

eddddy said:

It sounds like you have a "Ready, Willing and Able Purchaser" clause (or similar) in your contract with your Estate Agent. I always try to avoid contracts like that, because they cause the type of argument that you're having.


If the contract includes the specific phrase "Ready, Willing and Able Purchaser", the law defines what it means:

“READY, WILLING AND ABLE PURCHASER

A purchaser is a “ready, willing and able” purchaser if he is prepared and is able to [exchange unconditional contracts for the purchase of your property].

You will be liable to pay remuneration to us, in addition to any other costs or charges agreed, if such a purchaser is introduced by us in accordance with your instructions and this must be paid even if you subsequently withdraw and [unconditional contracts for sale are not exchanged], irrespective of your reasons.”

link: https://www.legislation.gov.uk/uksi/1991/859/schedule/made

So you can argue that your buyer isn't prepared and able to exchange. But Estate Agents will often ignore that argument, and threaten to sue you anyway. (In my opinion, it's probably a scare tactic.)

You could probably defuse the argument by saying you'll let the current sale progress, but you want your current agent to start remarketing the property.

But what makes it difficult is that you want to change to a Joint Agency agreement - Estate Agents aren't keen on that. You'd have to give your agent the contractual written notice for your sole agency agreement. And they might continue their threats to sue you.

yeah, i think it is the fact that the OP wants to use another agent that is causing the problem.  if he stays with the same agent, they will re-advertise the property soon enough as they want their commission, which they won't get if the sale doesn't happen.

OP - are there reasons for the delay?  August isn't that long as a lot of December is public holiday.  Conveyancing has taken 5 months (without the seasonal period in between) for us before, so I wouldn't be too disgruntled if this was me selling the house and there are reasons for the delay.

but the estate agent can always threaten to put the property back on the market if the buyer is delaying without reason. 

NameUnavailable

I would just ask your existing agent to remarket the property - also allowing the current 'buyer' to carry on unless you get a new/better buyer.

The property will be marketed online so these days I don't really see any benefit in a multi agency strategy. Furthermore I think it can devalue a property if buyers see it being advertised by multiple agents, it looks like a difficult sell/problem property.