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How to choose an estate agent
Start with one check: ask to see the agent’s Fidelity Fund Certificate. A property practitioner needs a valid certificate to work, and has no right to be paid for work done without one. After that, compare agents on local knowledge, the plan for your home, the fee and the mandate you are asked to sign.
Check the basics first
The Property Practitioners Act has applied since 1 February 2022 and replaced the old Estate Agency Affairs Act. It says a practitioner must have a valid Fidelity Fund Certificate, and that an agent without one has no claim to commission for that work. A conveyancer may not pay commission without a certified copy of the certificate. So ask for a copy before you sign anything, and check it with the Property Practitioners Regulatory Authority (PPRA), which regulates the industry.
The agent should also be open about the agency they work for and who is responsible for their work. If something goes wrong, you want to know who to contact.
Look at their local record
An agent who knows your suburb will price better and know who buys there. Ask:
- How many homes have you sold in my area recently?
- How long did they take to sell, and how close was the final price to the asking price?
- Can I speak to two or three recent clients?
Look at their listings too. Check the quality of the photos and descriptions, and whether the listings are on the main property websites. This is how your home will be shown.
Ask about the price and the plan
Ask each agent to explain a suggested asking price with reasons: recent sales of similar homes, the condition of your home and the demand in your area. Be wary of an agent who gives a very high number just to win the listing. A price that is too high can leave your home unsold. See how to price your home.
Ask for a marketing plan in plain terms: where the home will be advertised, whether there will be a show day, and how often they will report back to you. No agent can promise a sale or a price, so treat guarantees as a warning sign.
Understand the fee and the mandate
Commission is negotiated. Rates are often quoted at about 5% to 7.5% plus VAT, and there is no standard rate in law. Ask for the rate in writing and calculate it in rands at your expected price. See estate agent commission explained.
Then read the mandate. This is the contract that appoints the agent. Check:
- whether it is sole (one agent has the exclusive right to sell) or open;
- how long it lasts, and how to end it;
- when commission is due, and whether it is due if you find the buyer yourself;
- whether other costs, such as advertising, are charged to you.
A short sole mandate is easier to manage than a long one. See sole mandate or open mandate.
The disclosure form
An agent may not accept a mandate to sell a home unless you have given them the completed, signed mandatory disclosure form, which lists known defects. They must also give a copy to anyone about to make an offer. If the form is missing or unsigned, the agreement is read as if you disclosed no defects, which can leave you exposed. A good agent will walk you through it. See the mandatory disclosure form.
Trust your read of the person
Pay attention to how the agent treats you. Do they listen, answer questions directly and return calls? Do they explain things in plain language? You will deal with this person for weeks, perhaps through a stressful negotiation. A pushy agent who rushes you to sign is a reason to step back.
What to do next
- Shortlist two or three agents in your area.
- Ask each for a copy of their Fidelity Fund Certificate and check it with the PPRA.
- Ask for a price opinion with reasons, a marketing plan and the commission in writing.
- Read the mandate in full before you sign, and ask for changes if you want a shorter period.
Browse agents and agencies on PropertyNow to build your shortlist, and use the estate agent commission calculator to see what each fee means in rands. If you are weighing up going without an agent, read private sale or estate agent.
This article is general information for South African readers, not legal, financial or tax advice. Rules and rates change, so check your own situation with an attorney, your bank or a tax practitioner. Our property calculators can help you work out the numbers.