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Estate agent contracts | everything you need to know 2023

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When you’re ready to sell your home, one of the first things you’ll need to do is sign a contract with an estate agent. But what does this contract actually mean? And what do you need to know about estate agent contracts?

In this blog post, we’ll be taking a look at the different types of contracts that estate agents may offer, what to expect in a contract, what to avoid in a contract and our best tips for understanding your contract.

What is an estate agent contract?

An estate agent contract is a legally binding agreement between a property owner and an estate agent. This agreement outlines the terms and conditions under which the estate agent will act on behalf of the property owner to sell, rent, or manage their property.

The estate agent will deal with most of the work regarding the contract, but as a seller your responsibilities will be to negotiate any terms of the contract, read the contract carefully, sign the contract if you are happy with it, communicate any questions you have to your estate agent and fulfill your obligations under the contract.

Here’s why estate agent contracts are crucial in property transactions:

Clarity of duties:

The contract lays out the specific duties and responsibilities of the estate agent. This could include marketing the property, conducting viewings, negotiating with potential buyers, and managing paperwork related to the sale.

As marketing a property is a big responsibility of an agent take a look below at how a good estate agent should do it on Rightmove.

How an estate agent should market your property on Rightmove
Fees and commission:

The contract outlines the fees the estate agent charges for their service. This is usually a percentage of the selling price. It may also detail other costs, like marketing expenses. If you would like to read more about estate agent fees we cover them in our blog here.


The contract can specify whether the estate agent has exclusive rights to sell the property, or whether other agents can also be involved. This is important because it determines who the property owner will pay a commission to upon a successful transaction.

Dispute resolution:

In case of disagreements or disputes between the property owner and the estate agent, the contract serves as a reference point. It outlines the agreed terms and can help in resolving conflicts.

Legal protection:

The contract provides legal protection for both parties. If one party fails to meet their obligations, the other can seek legal recourse.

Duration and termination:

The contract outlines the agreement’s duration and the conditions for its termination. This gives both parties a clear understanding of their commitment.

In essence, an estate agent contract is crucial because it provides a clear framework for the relationship between the property owner and the estate agent. It ensures both parties understand their obligations, protects their rights, and helps to prevent potential misunderstandings or disputes.

Types of Contracts

There are different types of agreement you could have, below we are going to go through each one.

Sole agency agreement:

Sole agency agreement is the most common type of contract that you’ll be offered by an estate agent. The agent will act as your exclusive agent in the sale of your home. With a sole agency agreement if you were to find a buyer yourself then you may not need to pay estate agent fees. However, check your contract as it is possible there is a clause which states that the agent can still claim commission even if you found the buyer.

The benefits of a sole agency agreement is that with just one agent communication and coordination becomes simpler. You only have to deal with one point of contact. A single agent ensures a consistent marketing strategy and message, which can be more effective and create a strong image for your property. In addition, the agent might be more motivated to sell your property as they know they will get the commission if a sale occurs within the contract period.

However, there are some disadvantages to a sole agency agreement for example if the agent is not effective, you might be stuck with them for the duration of the agreement, unless there’s a break clause. In addition, one agent might not have as wide a network or as many resources as multiple agents, which could potentially limit the exposure of your property.

Sole seller agreement

Another type of of contract that you may be offered is a sole seller agreement. This agreement is similar to sole agency agreements therefore it has similar advantages and disadvantages. However, they are less popular as there is one key difference between them both. Which is, if you was to find a buyer for your home yourself, you would likely still pay the estate agent you hired as they are entitled to this.

Joint sole agreement

A joint sole agreement is where you appoint two estate agent to help sell your home. Under a joint sole agreement, the agents will either share the commission from the sale of your home or beforehand decide who will get the commission. This means that you’ll only be liable for paying one set of fees.

The benefits of a joint sole agreement are that with two agents working to sell your property, it’s likely to get broader exposure to potential buyers, increasing the chances of a quicker sale. Also, different agents might have different areas of expertise or different networks, which could be beneficial in marketing and selling your property.

The disadvantages of joint sole agreement are that having two agents could lead to potential communication mix-ups or inconsistencies in the way the property is being marketed. In addition, coordinating with two agents could be more time-consuming and complicated than dealing with just one.

Multi agency agreement

The last type is a multi-agency agreement. This is where you appoint more than one estate agent to sell your property. Under a multi-agency agreement, each agent will work on their own behalf. This means that they’ll be competing against each other to sell your property.

The benefits of multi agency agreements are that since only the agent who makes the sale gets the commission, there’s a competitive incentive for each agent to work hard to sell your property. Also, if one agent isn’t performing well, you have others working simultaneously to sell your property.

However, there are disadvantages such as, multi-agency agreements typically come with higher commission rates compared to sole agency agreements, as the agents take on more risk knowing they may not be the ones to make the sale. In addition, multiple agents marketing your property could lead to inconsistent messaging or marketing strategies.

Types of estate agent contracts
Types of estate agent contracts

So, those are the different types of contract that you may be offered by an estate agent. But what else do you need to know about them?

Key elements in the contract

Here are the key elements typically included in the contract:

  • Parties involved
  • Description of the property
  • Duration of agreement
  • Agent’s duties
  • Type of agreement
  • Commission and fees
  • Procedure for disputes
  • Confidentiality and data protection
  • Cooling-off period
  • Redress scheme membership
  • Complaints procedure
  • Money laundering checks
  • Property Ombudsman Scheme
  • Signatures

Are the contracts legally binding?

It’s important to understand that all contracts are legally binding. This means that once you sign the contract, you are legally obligated to adhere to its terms and conditions. If you decide to change your mind or fail to fulfill your obligations as specified in the contract, you could face legal consequences.

Cooling off period

If you decide that you want to cancel the contract, you may be liable for paying the agent’s fees. However, most contracts will include a cooling-off period. This is a set period of time (usually 14 days) during which you can cancel the contract without having to pay any fees.

Your agent should give you in writing a clear notice stating that you can cancel the contract within 14 days. So, make sure this is made clear to you.

Notice and tie in periods:

They will be a tie in period which means how long you are bound to the contract. Most seller’s shouldn’t be tied in over 12 weeks. You should also look at if there is a notice period. If there is one then it is usually between one and four weeks.

It is important to check as you could be tied in to a contract for a number of months. You also need to know how much notice you have to give.

Avoid ‘ready willing and able purchaser’

You want to avoid this clause as it means if your agent can continue to find a buyer for your home, the agent will still make you pay the fee even if you choose not to sell your home to that buyer. In fact, the property ombudsman has banned the use of this clause so if an agent is still using it, it could be an indicator as to the type of agent that you are dealing with.

Extra charges

It’s also important to check whether there are any extra charges that you’ll need to pay, such as marketing fees. These will usually be outlined in the contract, so make sure you read it carefully before you sign anything.

You should also look at if the fee you were quoted includes VAT or if this an extra cost you will need to pay.

If you like to read more about what should be included in the estate agents fees and the average costs of estate agent fees you can read our blog post here about the costs involved in selling your home.

Is it possible to get out of the contract?

You can get out of a contract easily if you give the correct notice period stated in your contract and you are near the end of your tie in period. Otherwise it can be hard to get out of it as it is legally binding.

If your estate agent was to breach the contract then you could be able to get out of it. For example, if they said they would market your home on property portals but then didn’t.

The best thing is to find a great estate agent from the start. We have hand picked trusted estate agents in your area on our platform homemove ready to help you sell your home.

Our best tips

Reading and understanding your estate agent contract is crucial before you commit to anything. Here are some tips to help you navigate this process:

Take your time:

Don’t rush through the contract. Take the time to read it thoroughly, ensuring you understand each clause and its implications.

Understand the fee structure:

Make sure you clearly understand the agent’s fees, how they are calculated, and when they are due. This is usually a percentage of the sale price and can vary based on the type of contract.

clarify the type of contract:

Understand whether it’s a sole agency agreement, sole seller agreement, joint sole agreement or multi agency agreement. Each has its own implications, especially regarding exclusivity and the payment of commission.

Understand your obligations:

Contracts will not only stipulate what the agent must do but also what is expected from you. Make sure you understand and are comfortable with these obligations.

Ask questions:

If anything in the contract isn’t clear, ask the estate agent to explain. It’s important that you fully understand what you’re agreeing to.

Keep a copy:

Once you’ve signed the contract, make sure you keep a copy for your records. This can be important if any disputes arise later on.


So, there you have it – everything you need to know about estate agent contracts! Hopefully you now know the different types of contracts there is and that you must check over the contract before signing, to ensure there is no hidden fees and you know your tie in and notice period. You can always seek legal advice if you are in doubt about anything.