Real Estate

I sold my home to a neighbour – do I have to pay the agent's fee?

Q A few months ago I agreed to have the photographs done and marketing literature for my home prepared by an estate agent in readiness for a move in late summer. I also signed a contract with them to market and sell my home. However, before it actually went up for sale a local couple who are neighbours asked if they could buy the house from us. I directed them to the estate agent who arranged a viewing and they made an offer which was accepted. The house never actually went on the market with the agents or was advertised by them. We are nearing exchange of contracts now and I was wondering if there would be any leeway to negotiate a reduction in the commission seeing as the agent did not actually find the buyer.

A You could give it a try but I don’t hold out much hope. Because the agent arranged the viewing and the buyers made their offer via the agent, the agent can argue that they did find the buyer. This would not have been the case if you had shown the buyers the property and had accepted their offer from them directly. That’s because if you signed a sole agency agreement with your agent – which is the most common type of estate agent contract – while you can’t instruct another agent to sell your home, you are free to sell it privately without involving the agent you are tied to during the term of the contract. And if you do find your own buyer and don’t involve the agent in the transaction, you are also let off paying the agent’s commission (although you may be asked to cover the costs of getting the photographs and marketing literature done).

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It may be little consolation that if you made the mistake of signing a contract with sole selling rights (rather than sole agency), you still have to pay the estate agent’s commission even if you managed to find the buyer yourself.

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