Agency agreements, read
What you sign with an estate agent and what it costs, read from three real agreements, and Homebinding's own agreement filled in on the record.
What an estate agency agreement does to you
Every agent's terms of business are a contract, and the Estate Agents Act 1979 with the Estate Agents (Provision of Information) Regulations 1991 require the agent to give you those terms in writing before you are committed. Most sellers sign them at the kitchen table without reading them. The terms decide three things that matter: when a fee is owed at all, how much it is, and how long you are tied to that agent whatever happens.
The three phrases to look for are sole agency, sole selling rights and multiple agency. Under sole agency you owe the fee if the agent, or anyone else, introduces a buyer during the term; under sole selling rights you owe it even on a buyer you found yourself, and often on any sale within a period after the term ends to a buyer the agent showed round; under multiple agency you owe it only to the agent who introduced the buyer. A ready, willing and able purchaser clause means you can owe the fee even if you withdraw before exchange. Marketing fees, withdrawal fees, entry fees and referral payments from conveyancers are the other places money moves.
Homebinding's founder has signed several of these over the years, for the same property and others, and they are the raw material for this page: a high street chain's sole agency terms, a Bristol auction house's public auction sole agency terms, and an online auction platform's Modern Method of Auction contract. The table below sets out, from those documents, what each one actually provides. The documents themselves stay on the founder's file; they are other firms' copyright and carry his personal details. What is published here is the reading of them.
This is not advice. If an agreement you have been given differs from the table, read your own copy; the figures below are the ones in the documents the founder signed, on the dates he signed them, and firms change their terms.
Sole agency, auction house, online auction: what each one costs
| Term | High street chain, sole agency (signed July 2017) | Bristol auction house, public auction sole agency | Online auction platform, Modern Method of Auction (signed June 2023) | Homebinding |
|---|---|---|---|---|
| Type of agency | Sole agency, box ticked; multiple agency offered at a higher rate | Sole agency from signing until the next auction and for two weeks after it | Sole selling rights for the contract term | Multiple agency by default; the seller stays free |
| Tie in | 26 weeks from the date of the agreement | To the next available auction plus two weeks | Minimum 60 days; 21 days written notice to withdraw | Ends on 21 days notice at any time; no minimum |
| Fee | 1 percent plus VAT of the sale price (a fixed fee was the alternative) | 1.25 percent plus VAT of the sum realised, payable if a sale is effected "whether arranged by us or not" during the term | Buyer pays a non refundable reservation fee of 4.2 percent including VAT, minimum £6,000; the seller pays the same amount in five listed circumstances, for example agreeing a private sale during the term | A set annual fee for the platform, published in advance, and where the seller asks Homebinding to act as agent, a commission of 1 percent on completion only |
| Up front or fixed charges | Optional Premium Marketing £149 plus VAT and Premium Marketing Plus £175 plus VAT, non refundable, refunded only if the chain's own conveyancing service is used; EPC £59 plus VAT | Auction entry fee £350 plus VAT in advance, non refundable; EPC £80 plus VAT; £200 plus VAT to supervise a pre auction contract signing; £150 plus VAT for the auctioneer's legal agent at the auction if no solicitor attends | Auction pack fee £445 including VAT, payable on a sale; management pack for leaseholds at the freeholder's price | None. Photography, plans, brochure and printing are in the fee |
| If you withdraw | Notice required; the marketing charges stay paid | Withdrawal fee £1,000 plus VAT after signing | £360 including VAT if withdrawn before the end of the 60 day term; 21 days notice required | Nothing |
| If the sale falls through | No fee, no sale | Half the commission on the agreed price, collectable from any deposit held by the seller's solicitor, if a sale agreed at auction is not completed | The seller becomes liable for the full fee where the seller fails to proceed with a ready, willing and able buyer, or agrees a private sale to a registered viewer within 12 months of the term ending | Nothing from the seller; the buyer's deposit under the reservation agreement is what protects the seller |
| Referral payments | The chain's conveyancing service is a referral: out of the legal fee the law firm keeps on average £558 including VAT and the balance goes to the chain | None stated | Up to £450 paid to the partner agent by the conveyancing provider it recommends | None; if that ever changes it is disclosed in writing first, as section 18 requires |
| Cancellation right | 14 days under the 2013 consumer regulations, with a request to start work at once inside the period | Not stated on the face of the terms | 14 day cancellation period, lost if a viewing takes place inside it; pack costs reimbursed | 14 days for a consumer, and nothing to reimburse because nothing is charged |
| Keys, access and boards | Keys received, box ticked | Keys held by the agent; a for sale board unless agreed otherwise | Access through the partner agent | Viewings by appointment through the record; keys only where the seller asks |
| Redress | The Property Ombudsman | The Ombudsman for Estate Agents code | The Property Ombudsman | A government approved scheme, named in the footer before launch |
Read from the founder's own signed copies: a Connells Residential terms and conditions of business and instruction forms dated 7 July 2017 for 13 Humphrys Barton; Hollis Morgan Property Limited's public auction sole agency agreement for land at 61 Arbutus Drive; and the IAM-SOLD Modern Method of Auction sales contract and terms (CWBPSFv1.9) dated 6 June 2023 for Flat 1, 61 Arbutus Drive. Every figure is as printed in those documents on those dates. The documents are not reproduced here.
Seven questions to ask any agreement before you sign
1. Sole agency, sole selling rights or multiple agency: which words appear, and does the definition in the small print match the box that was ticked. 2. How long is the tie in, and what notice ends it. 3. Is there a ready, willing and able purchaser clause, which makes you liable for the fee if you change your mind before exchange. 4. What is charged before a sale (marketing, entry, EPC, packs) and which of it is refundable.
5. What happens on withdrawal, and what happens if a sale agreed falls through: half the fee, the whole fee, or nothing. 6. Who pays whom on referrals to conveyancers, mortgage brokers and surveyors, and how much. 7. Does the agent have a personal interest to declare under section 21 of the Estate Agents Act, and has it been declared in writing. If the agreement is silent on any of these, ask before you sign, and keep the answer in writing.
Homebinding's own agency agreement, filled in on the record
Where a seller asks Homebinding to act as agent rather than simply listing on the platform, this is the agreement. It is the same document for every seller: multiple agency, one percent on completion only, no charges before a sale, 21 days notice, a 14 day cancellation right for consumers, and a written declaration of any interest Homebinding has. Fill it in here; the answers stay in this browser until the Homebinding back end is live, when the completed agreement goes onto the transaction record for signature by both parties.
The full terms behind this form are the Homebinding Sale Agency Agreement: appointment, commission, what each side does, existing agents, term, cancellation, fees and referrals, disclosure of interest, accuracy of information, identity checks, the property, data protection, complaints and redress, liability, general. How a sale works explains what happens after instruction.
Where this sits in the sale
The agency agreement, where there is one, is the first document on the transaction record. The seller's information forms, the contract for sale and the report on title follow it, all on the same record, all filled from the same facts, so nothing is retyped and every party reads the same page. The documents in the seller's public folder, the EPC, planning permissions, building regulations certificates, guarantees, are attached to the listing for every buyer to read before they offer.
Sources: Estate Agents Act 1979; Estate Agents (Provision of Information) Regulations 1991; Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013; the founder's signed agreements named above.
