The real estate agent you choose to sell your house will ask you to sign an agency agreement.
An agency agreement is a legally binding contract. Before signing make sure you have read and fully understood it and get your lawyer to check it. Your agent must recommend that you get legal advice before signing an agency agreement.
Your agent must also give you a copy of the Agency Agreement Approved Guide (.pdf 170KB) and ask you to confirm in writing that you have received it. You should read this guide before you sign the agency agreement.
The guide is available in a number of languages from the Forms and Publications section.
We recommend you only enter into an agency agreement with an agent who uses the voluntary standard clauses for residential agency agreements. See the section below about these standard clauses. These clauses help protect you by providing clarity on when an agency agreement ends and when a commission needs to be paid. Find out more and get a list of agencies using the standard clauses.
Negotiating the agency agreement
You do not have to accept an agent’s proposals and you can negotiate terms, including commission and method of sale, before signing the agency agreement.
See our Agency Agreement Approved Guide (.pdf 170KB) for more information.
Check the length of the agency agreement and the date on which you or the agent can cancel it
Your agent must explain to you when the agency agreement will end. Make sure you check what the cancellation terms are. These can vary from agency to agency.
You can negotiate changes to the agency agreement before you sign it. Be aware you may have to pay the agent a commission even if you cancel the agency agreement and then sell the property privately later to someone the agent introduced.
Sole agency agreements
A sole agency agreement gives one agent or agency the exclusive right to market and arrange the sale of your property. If you sign with a sole agency agreement you should not sign another agency agreement with any other agent until you have cancelled the first agreement. If you do, you may have to pay all agents a commission, regardless of which one arranged the sale.
Cancelling a sole agency agreement
If the sole agency agreement is for a residential property and for a term longer than 90 days, the client or the agent can cancel the agreement at any time after 90 days.
Make sure you check what happens when the sole agency agreement is cancelled. Some sole agency agreements become general agency agreements when cancelled – this means that you will also have to cancel the general agency agreement if you no longer want to work with the agency.
When a sole agency agreement is cancelled your agent must give you a list of people they have introduced. If you sell to one of these people, the agent may be entitled to a commission.
The 5.00pm window for cancelling a sole agency agreement
If you change your mind after signing a sole agency agreement you can cancel it by 5.00pm on the first working day after you have been given a copy. This must be done in writing ie, letter, email or fax.
However, if an agent carries out any work before the agreement is cancelled and that work results in the sale of the property after the agreement is cancelled, the agency agreement will be legally binding and you will have to pay that a agent commission.
General agency agreements
A general agency agreement gives more than one agency the right to market your property. You will be asked to sign a general agency agreement with each different agency. Your lawyer can advise you on this.
Cancelling a general agency agreement
When a general agency agreement is cancelled your agent must give you a list of people they have introduced who, if you sell to, may entitle the agent to a commission.
Standard clauses for residential and rural agency agreements
Real estate agents can choose to use voluntary standard clauses in their residential or rural agency agreements. We recommend that you only use agents who use these standard clauses. These clauses help protect you by providing clarity on when an agency agreement ends and when a commission needs to be paid.
Find out more and get a list of agencies using the standard clauses.
What the agent should provide to you be
fore you sign an agency agreement
The agent must do a number of things before asking you to sign an agency agreement, including giving you a written price appraisal of your property and a written estimate of their commission. Make sure that everything has been provided to you before you sign the agency agreement.
Read more about what agents must give you.
The agent must also tell you if they have a conflict of interest
Agents must tell you if they have a conflict of interest: for instance, if the agent or someone connected to them is interested in buying the property.
Read more about conflicts of interest.