Here’s when an agent will spend the least amount of time marketing your home
Picture this: Two agents, smack bang in the middle of one of the craziest, busiest days of their year. One of these agents has a sole mandate to sell a home similar to yours one block away. The other is one of the six agents trying to sell your home. A buyer looking for something specific in your neighbourhood asks both of these agents for more info on the home they are marketing. Remember these agents are busy, busy, busy they need to prioritise and manage their communication to get through the day.
The agent with the sole mandate is significantly more likely to answer the buyer, much sooner than the agent marketing your home on an open mandate, the buyer views the home, makes an offer, moves in, and become your new neighbour while you are still trying to decide whether you should rather agree to one sole mandate with a specific area expert for the next six months and actually get your home sold.
This is because agents spend 80% of their time and effort on sole mandates and the remaining 20% on open mandates.
Kevin Abbott, sales associate at RE/MAX Premier, says that the reason is because agents don’t want to spend time, money and effort marketing a home, only to lose the deal to another agent. “Agents work on a commission basis, so if they don’t sell, they don’t make money. An open mandate is risky for an agent, as it could cost them money and result in no reward,” explains Abbott.
So what are the options?
There are typically three options when it comes to mandating agreements – an open mandate, dual mandate or a sole mandate. If a seller opts for the open mandate route, they are taking the exclusivity out of the deal – giving the home to multiple agents to sell, often from a variety of agencies.
“While this means that several are tapping into their networks to find the right buyer for the home, things can get complicated, and there is the danger of the seller having to pay a possible double commission,” advises Abbott.
According to Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa, unlike a sole mandate, which is a written agreement, an open mandate can simply be a verbal agreement between the parties. If there is no written agreement in place, certain aspects can be misinterpreted, which could cause conflict. A clear, written contract protects both the seller and agent, reducing the risk of any misunderstandings.
The downside of an open mandate
According to Abbot another problem with an open mandate is that when buyers drive up to a home with several sign boards outside, it screams desperation – this isn’t the message that sellers want to convey. “Nothing scares away prospective buyers quite like desperation,” says Abbott. “Immediately, potential buyers start to question why it takes so many agents to sell the home, thinking there could be some underlying issues that they are not aware of.”
He says that in an open mandate scenario agents will bring the seller the first offer they receive, which might not be the best offer – this is because they want to get the offer to the seller before another agent does. “The thing is that when selling your home, you want the buyers to be competing and not the agents. The agents are not the ones who are going to buy the property.”