Can I sell privately while estate agent is also selling the property?

Seregwethrin

Hi,

I've been trying to sell a property for couple of months now with not much of bidding happened through the estate agent.

My neighbour there got me in touch with a lovely local young couple who is offering the price I was looking for, even more but I am okay with what I ask.

My only concern is if the agency chases me for the fees if I sell privately. In that case, I should arrange a viewing for them with the agent but I feel the agency did not fulfil their responsibility to get me a buyer who is willing to pay as much as them for multiple months.

I also already paid a good marketing fee to them to advertise on platforms and photos, that wasn't on agents pockets. I am not sure if the buyers clicked on any "contact agent" buttons on the websites, but they said they never communicated or contacted with the agent.

And if I can do this, any thoughts on how should I discuss this with the agent do you know? Just let them know I am not selling or openly tell them I found a private buyer? I don't think I can ever go back to them if I try to sell privately even if the sale falls through, right?

Thank you

Trigger Happy

I did this and long time ago. The estate agent was fairly useless and we had signed no agreement with them.

Like yourself...a neighbour contacted me directly as he had heard I was selling. I called the estate agent and told them I would no longer be using the services. Myself and the neighbour agreed a deal on the asking price minus what fees the estate agent would have received. No deposit.

We handed it over to our respective solicitors to handle the remaining details. It worked very smoothly and highlighted to me how little estate agents do.

Q&A

Did you sign a contract with the estate agent and what did the contract specify? It might have a clause in it entitling them to something if the house is sold within a specified timeframe.

I would check the wording first before doing anything. After that you've to way up the odds of the potential savings versus the cost of interested party walking away and having to go through the process of getting an estate agent again.

Seregwethrin

I just checked and the contract says it's a Sole Agency contract. I am not seeing any clause about me selling it privately.

I looked it up and it seems there are Sole Agency and Sole Sale Rights. As names imply, Sole Sale Rights type restricts the owner selling privately but not Sole Agency. That's my take anyway.

But there is a chance the sale doesn't go through and I might have to go back to agents, in that case I could not go back to the same agents and I'd lose the other interested buyers. There are not a lot of them, anyway! I might try to sell it myself in that case, I really liked how I answered their questions. Agents have to ask me so they can answer buyers questions... Only thing is, a private person wouldn't be trusted to hold a bidding process, but not much of bidding is going on too.

I guess the real question is, at which point I must tell the agents. Immediately, or after proceeding a bit with the sale privately.

https://www.boards.ie/discussion/comment/120141458#Comment_120141458

I suspect sole agency means they get paid even if you sell privately as you are contracting the sale agency to them. There is usually an exclusion period after termination during which they get paid even if you or another Agent sells the property. Which of course all makes sense, otherwise after they have advertised/communicated with interested buyers, the seller could just cut them out like you want to do and they lose out on the sale. Talk to your solicitor and show him/her the contract with the EA, otherwise you may get a nasty letter down the line demanding payment and a threat of legal action.

Talk to the auctioneers, tell them you have a close contact that has come to you directly offering the asking price.

They need to provide a purchaser offering over asking now in order to justify their fee. They have had the listing a while and it sounds like they are not putting the work into the sale. You have paid for the advertising so they won't be out of pocket.

Be upfront with them now and let them know where they stand.

https://www.boards.ie/discussion/comment/120142264#Comment_120142264

That is not the way it works. If the contract states they are sole agency for sale, they are probably still entitled to their fee even if you sell privately during the contract. They don’t need to provide anything more than they are.

Q&A

Having established that the EA is likely entitled to a fee - if you sell - under the agreement you signed the question becomes what value added do they bring to the process now. If the answer is very little you could still part ways and hope for the best. I wouldn't go pointing out you have a bidder. I'm sure many people in your boat would be disappointed with the lack of interest and in light of many factors (cost of living crisis, rising mortgage rates etc.) Some would decided not sell after all.

Technically while you might owe them a fee -if you did sell - you don't have to go knocking at their door to transfer it. Sales can take a long time to work through even in the most straightforward of cases. You might exceed the exclusion period. Perhaps they might be too busy selling other properties to notice. But be prepared to pay if asked.

Seregwethrin

I am reading here that sole agency allows the owner to find a private buyer: https://www.sold.co.uk/news/what-is-a-sole-agency-agreement-and-should-they-be-avoided/

If you end up finding a buyer yourself when you’re in a sole agency agreement, you won’t have to pay estate agent fees (although depending on the terms of the contract, they may still be able to claim commission).

And a news below. These are UK but I assume we are similar here.

Sole selling rights is the same as sole agency except you have to pay the estate agent even if you find your own purchaser, such as a friend. Multiple agency agree ments allow you to market the property with several agents and, as a result of the extra competition for buyers, agents charge higher fees. 

https://www.theguardian.com/money/2001/apr/14/homebuying.timetable

I’m not sure that supports your viewpoint in the way you think it does, again, the most important line in it is “depending on the terms of your contract….”. Also, as you said, that is UK and may not be relevant here.

Seregwethrin

https://www.boards.ie/discussion/comment/120143275#Comment_120143275

Sounded to me as they describe my point. I don't see a clause in the contract regarding a private sale. There is a clause that the agency would be owed fees if another agency is involved and sells but no other agency is involved.

SwimClub

If someone is wandering up to you randomly making better offers than the EA can drum up, they can hardly expect a commission for value add.

They may have genuinely tried and it was just bad luck their side/random luck someone fell in your lap with the best offer, if that's the case letting a one in a thousand lucky event like this slide should be no big deal for the EA or their business.

snowcat

https://www.boards.ie/discussion/comment/120143242#Comment_120143242

I would not be worrying about the 'contract'. Estate Agents generally do not add any value to a sale. I was always an advocate of sell it yourself and dont trust the middle man. He is only in it for his commision. If he loses the sale he will just move on and find the next willing seller. He has put in very little cost or effort except a daft ad and maybe a few viewings. Much more satisfying to be in control of the sale process when you are selling your highest value asset.

Seregwethrin

https://www.boards.ie/discussion/comment/120143712#Comment_120143712

Yeah, I actually enjoyed answering the buyer's questions. It's like explaining your car from the passenger seat who is having it for a test drive. Also, I prefer to sell it to someone even a few K less who will fit in nicely in the neighbourhood e.g. someone knows a few people around and who will make use of the place and location good rather than someone more random. I think if you are not looking to get bidding wars it makes sense to sell privately. Bidding wars might create tension and bid legitimacy might be a concern through a private seller but if you have a number in your mind, private sale looks very logical to me now.

https://www.boards.ie/discussion/comment/120143661#Comment_120143661

Neighbours also have an interest to bring in someone they know, obviously. I had the pleasure of living in a neighbourhood where a lot of people knew each other, inviting each other to their homes etc it's lovely and safe. I think it makes a neighbourhood nicer.

https://www.boards.ie/discussion/comment/120142358#Comment_120142358

My understanding is they will remain the sole agency as the OP is not proposing bringing in another agent to sell the property what they are talking about is selling directly. A lot will be determined by the contracts signed with the auctioneer and without seeing those all we can really offer is an opinions, as you will need to engage a solicitor for the sale it might be worth getting their opinion. I'm sure they will have clauses that guarantee their commission if you decide to sell privately to a buyer they brought to the table, but if the auctioneer hasn't provided the potential buyer and advertising has been paid in advance by the OP they haven't earned their commission.

daheff

tell the agent you are taking the property off the market as you have not gotten the interest you expected.

then sell to the willing buyer. But be prepared to have the agent come looking for their fees.

wildwillow

I had several people contact me to offer privately for my house. I passed the information to my agent. One was a neighbour who "really wanted to buy" my house. Another was someone who didn't want to deal with my agent. Neither was a genuine bidder and were known by local estate agents for showing interest in almost every property in the area. Neither has bought anything in the four years since I sold.

My agent was also very proactive in getting the sale completed and put a bomb under the buyers solicitor who was a nightmare to deal with.

I had dealt with the same agent on several other transactions and knew him to be genuine and honest.

So tread carefully before doing anything. Why didn't your buyer go through the agent? He has already done the work in advertising the property. He will also be better at recognising a time waster and will check whether finance is in place before proceeding.

Accept the higher offer through the agent and let that pay the fees.

https://www.boards.ie/discussion/comment/120144968#Comment_120144968

What is “earning their commission” if it isn’t advertising the property and dealing with interested buyers? Are you under the impression that EAs are tasked with negotiating price or agreeing to sell to a particular buyer by the vendor?

The Continental Op

https://www.boards.ie/discussion/comment/120145336#Comment_120145336

The OP stated they have already paid the agent a marketing fee.

Claw Hammer

Sole agency means you cannot also use another agent simultaneously. Sole right to sell means you cannot sell yourself or using another agent.

What these cases come down to is who introduced the buyer to the property. If the buyer saw advertising and approached you, and you sold to them, then the agent is entitled to his fee.

If they approached you without knowing there was an agent involved and you sold then the agent does not get a fee. If you sell behing the agents back and they have any record of being contacted by the buyer, prepare for a court case if you don't pay the fee.

ohnonotgmail

https://www.boards.ie/discussion/comment/120141458#Comment_120141458

Does the contract mention anything about a period for the sole agency?

https://www.boards.ie/discussion/comment/120145336#Comment_120145336

I suppose everybody's view of an auctioneer earning their commission will be different but I would say at a minimum it would involve attracting buyers through advertising and engaging with potential buyers to achieve the maximum price for the property.

The OP has already paid upfront for the advertising and they have found a buyer outside of the auctioneer that is offering an agreeable price, I fail to see what services the auctioneer provided that deserves a 1-2% commission. I'm aware its not the best time of the year to be selling a property but I'm getting the vibe that the OP is not overly impressed with the performance of the actioner so far.

thomas 123

https://www.boards.ie/discussion/comment/120143661#Comment_120143661

I suppose you could argue that they are making the offers as they know its for sale due to the estate agents advertising etc

Seregwethrin

I actually got information from my solicitor that "sole agency" may not only mean estate agents, me myself or my neighbour who introduced us could be considered an agent and those words are not limited to a business... So my best bet is to ask them to go through the agent in this case.

To be honest, even if I can do the sale privately, if the agency comes back for their fees and takes this to the court, the court and solicitor fees will be higher than their fee...

Also, by going with the agent I know if the sale falls through, we can just go back where we left off.

It think it's better to play safe and get this done.

Seregwethrin

Words are so open to interpretation that you can stretch this all the way that a solicitor can be considered an agent as solicitors are actually handling and finalising the sale, not the estate agents... just my thoughts

https://www.boards.ie/discussion/comment/120152806#Comment_120152806

How would a buyer know what solicitor to approach to buy your house?

ohnonotgmail

https://www.boards.ie/discussion/comment/120153024#Comment_120153024

they could ask you.

Bargain_Hound

I did this with our 1st property. Was advertised with a local E.A., weeks went by with nothing from them, very little interest. A knock on the door one evening from an interested buyer who was keen on avoiding the E.A. A price was agreed pretty much there and then and both parties solicitors were engaged while requesting E.A to remove from sale. It was all very straight forward & Sale complete in 6-7 weeks. Heard nothing more from E.A (5 years ago).

-Saved several thousand on fees

-No negotiations

-No time wasted on viewings or Playing E.A games

-Honest communication with buyer

I should add, from what I remember, in the PRSA contract it stated something along the lines of; once I removed it from sale I was not in breech as the buyer was not introduced via. the agent and also contracts were not exchanged during the period it was listed for sale with the agent (or within the 14 days notice period to withdraw from sale)

Claw Hammer

https://www.boards.ie/discussion/comment/120155522#Comment_120155522

The cases all turn on the introduction. It depends on the agent. Some agents will turn up with a phone record from the buyer months after the sale has closed to show they introduced the buyer. In some cases the courts have awarded fees to the auctioneer on the basis of a quantum meruit rather than the agreed percentage. Some agents are aggressive in suing, some are not.

There is a clear distinction between sole agency and sole right to sell. You canot be your own agent. Unless the neighbour has an auctioneers licence he can't be an agent either.

If a buyer wants to avoid an agent i would wonder if that buyer is a messer.

manniot2

Hi. May I ask, if the agent has found a buyer for me but I can’t sell as I can’t find anywhere to go, do I need to pay the agent their fee or is this dependent on a “willing purchaser” clause being in the contract? Thanks

herbalplants

https://www.boards.ie/discussion/comment/120590612#Comment_120590612

If you are not going through with the sale, you don't pay any agent fees.