Securing a sole mandate agreement on a property can be highly beneficial for you as a real estate agent. Properly done, sole mandates can be best for agents and for the clients that they represent. While your intentions may be pure, your potential client may have some concerns that they will want you to assuage. Some home sellers have been burnt by unscrupulous agents, and it can be in your interests as an agent looking to secure a sole mandate to pre-empt your client’s concerns about agreeing to a sole mandate.
Honesty is the best policy when it comes to securing a potential client’s trust. To keep your clients confident in your ability to make the most of your sole mandate, know how to answer these common questions about sole mandates.
What’s the advantage to the seller of having a sole mandate rather than an open mandate?
Real estate agents unanimously prefer sole mandates since it gives them a level of protection over their sales, but it’s not immediately obvious why sellers should prefer the sole mandate option too. A crucial factor is that some estate agencies give much more attention to sole mandates, since committing agency resources to open mandates is a waste of money if they fail to secure the sale.
The consequence is that agencies will look to use minimal resources on open mandates, and will favour fast-and-cheap sales.
What’s the agency’s success rate with sole mandates?
As an agent, your sales figures should be a point of pride. Be open about your reasons for preferring a sole mandate, but also remember to point to your own track record in securing great sales for sole mandates. In general, agents tend to secure better sales with sole mandates – show the client your evidence.
How does the agency plan to market the property?
As part of securing a sole mandate, make certain to include a written marketing plan for the property. This is an explicit agreement about the methods that you intend to use to produce a sale. A sole mandate produces a greater incentive for action in an agent. Showing that the full resources of the agency will be directed towards securing a sale for the client will go a long way to easing potential doubt about choosing a sole mandate to sell their home.
Is the property valuation true, or distorted to secure the sole mandate?
One major concern that a client may have about choosing a sole mandate may be that their agent has inflated the value of their property in order to secure the sole mandate. This is an infamous tactic, known as ‘buying the mandate’ and one that leads to properties going unsold. A property that lies unsold loses its ‘uniqueness’; ultimately this can lead to major issues for the seller. Assuring the client that your valuation technique follows best practice, and providing comparative data, like the selling prices of similar properties in the vicinity, will ease their worries in this regard.
What protection does the seller have if they become unhappy with the mandate?
As an agent, you should hold your contracts with sellers to the highest degree of transparency. Make sure that you include cancellation clauses within the sole mandate contract – this protects the agent from accusations of unscrupulous practice, which can ruin a hard-won reputation, and the seller from feeling trapped in their contract. Such clauses for cancellation may include your failing to keep to the marketing plan, and failing in your duties to the client as their representative, as well as a general expiry date on the mandate (typically 90 days after signing the mandate).
You can also explain that they are protected by the Consumer Protection Act – if they wish to cancel the sole mandate contract, they can give 20 working days’ notice. Cancellation fees can be charged if the client decides to pursue this option.