One of the first decisions you need to make when placing your property on the market is who to entrust with its marketing and sale. Open mandates allow several real estate agencies to market your property at the same time. Sole mandates place the responsibility on a single agent or agency for a period of time.
While it may seem like having more agents working on your sale is the best way to reach a wider buyer pool and sell faster, property experts say the opposite is almost invariably true.
A sole mandate - sometimes also called an exclusive mandate - is an agreement whereby the seller gives one selected agency the sole right, or mandate, to market and sell a property.
The agreement must be in writing and should stipulate the length of time the mandate applies for, the selling price of the property, the commission structure agreed upon, as well as any other terms and conditions pertaining to the sale of the property.
“The key reasons for signing a sole mandate with an agency is to avoid the duplication of potential buyers and the risk of potential double commission claims.
"Bluntly put, it can become very messy and unnecessarily complicated when there is more than one agency trying to sell a property, which often also leaves potential buyers frustrated and hampers the selling process,"
Most commonly, having various agents on the property can lead to disputes and disagreements about the pricing of the property, which in itself can have far-reaching consequences.
SEE: Is a sole mandate worth it when selling your property?
Quality over quantity
“When it comes to property listings, quality is far more powerful than quantity,” says Craig Mott, Cape Town Regional Sales Manager for the Rawson Property Group.
Thanks to the accessibility of online property portals, Mott says adding agents to your team doesn’t necessarily extend your property’s reach. Rather, he says it tends to dilute your sales message by requiring buyers to sift through multiple copies of your listing - some of which may be significantly less professional and effective than others.
“You create a far better impression by having a single, accurately priced listing that includes professional-quality photos and compelling descriptions,” he says. “Having the backing of a well-respected agent or agency also adds to your credibility, reassuring buyers that they’ll be dealing with an experienced property professional.”
READ: I signed a sole mandate but didn't understand what I was signing, what can I do?
The right incentives
Under ordinary circumstances, competition breeds excellence. When it comes to property sales, however, Mott says competition can incentivise agents to sell fast rather than high.
“Agents on open mandates are well-aware that another agent could sell the property at any point,” he says. “That means they’re more likely to try to push through a lower offer than risk losing out while negotiating a higher price. Likewise, they’re unlikely to put more than the bare minimum into marketing a property when they have no guarantee they’ll be able to recoup those expenses through a sale.”
Sole mandates, on the other hand, give agents the freedom to invest more time, money and effort in achieving a higher sales price without having to worry about losing the sale. Since their commission also increases alongside the seller’s profits, they have every motivation to make sure buyers bring their best possible offers to the table.
Fewer complications
Having one agent selling your home is also a less complicated option, with fewer risks attached, according to Mott.
“Open mandates mean communicating with multiple agents over multiple show houses and multiple private viewings. That can become quite invasive and annoying for sellers.
“You also risk becoming liable for double commission if there’s any dispute over which agent brought in your eventual buyer,” he adds. “That’s not something any seller wants to have to deal with.
Finding “the one”
There are risks to entrusting your sale to a single agent as well. You don’t want to be contractually bound to a sales partner who is unpleasant to work with or isn’t performing.
When interviewing for your ideal agent, Mott recommends prioritising passion, honesty and knowledge, and a proven track record of successful sales in your area.
“Value for money is important, but that doesn’t mean just choosing the agent with the lowest commission,” says Mott. “You want a well-presented professional who can substantiate their recommendations with personal anecdotes as well as hard evidence, and can explain exactly what service you’ll be getting in return for the commission you pay.”
Personality fit is also important since you’ll be working together for several weeks or even months.
“A good agent listens to your needs and respects your views. If you don’t feel heard, you haven’t found the right person.