There are four different types of Agency Agreements – Exclusive, General, Joint and Master.
An Exclusive (also referred to as a ‘Sole’) Agency is where the vendor/landlord lists their property with just one Agency. Exclusive Agency Agreements are widely regarded as the most suitable type of Agency to have on properties that are being marketed for sale.
A General Agency is where the vendor/landlord appoints multiple Agencies to sell or lease their property. A General Agency is widely accepted as the norm for commercial property leasing.
Properties can also be marketed under a Joint Agency, where two agencies are appointed to sell or lease the property. A Joint Agency is most commonly implemented for larger properties that are being marketed for sale. Another situation where a Joint Agency might be carried out is when the vendor/landlord prefers to deal with a smaller Agency but likes the idea of having a larger Agency with their supposed national or international reach.
On the rare occasion a vendor/landlord may decide to sell or lease their property under a Master Agency. This is where one Agency has advertising rights to market the property but any other Agency can submit offers from their buyers or tenants to the ‘Master’ agent and sell or lease the property. The vendor/landlord will have one point of contact (the ‘Master’ agent) in the process and in the case of another agent selling or leasing the property, will usually have to pay a higher commission to accommodate the two agents involved.
The main things to look out for in an Agency Agreement are:
- Timeframe (start date and end date, or in the case of General Agencies a notice period to terminate)
- Expenses (are you liable to pay any marketing costs?)
- Appraisal of the property
- The Agent’s commission rate / structure
- An Exclusive Agency will have a ‘cooling off’ period which gives you the right to cancel the contract within 24 hours of signing it
You should always seek legal advice before signing an Agency Agreement.
