You can check the public register at rea.govt.nz, which will let you know if your chosen agent is licensed and whether any complaints have been upheld against them. If you deal with an unlicensed person, the Real Estate Authority (REA) will not be able to help you if things go wrong. All real estate agents must follow the Code of Professional Conduct and Client Care. You can find a copy of this at rea.govt.nz. Remember, the agent works for you and must always represent your best interests.
There are two types of agency agreement
Sole agency agreement
Applies if you list your property with a single agency which will have the exclusive right to market your property. If you sign a sole agency agreement, you shouldn’t sign an agency agreement with anyone else, or you may end up paying commission to both agencies when your house sells.
General agency agreement
Aplies if you list your property with more than one agency. You’ll sign a separate agreement with each but only pay a fee to the agency which introduces you to the buyer of your house.
Your real estate agent must:
You should only sign an agency agreement once you’re happy with it, and you fully understand things such as the sales method, the agreement term, fee charged on a successful sale and what the expenses you’ll need to pay (like advertising).
Make sure you know how long your agreement lasts and when you or your agent can cancel it. Sole agency agreements can be cancelled without penalty if it’s done in writing by 5 pm on the first working day after you receive a copy. After that, if you cancel an agreement before it ends, you may still have to pay a fee to the agent if they have done any work that helped to sell the property.
Also, make sure that your agent does not have a conflict of interest, such as wanting to purchase your home for themselves. Learn more about conflicts of interest at the REA website.
An advertised price sale is where your property is marketed at an advertised price with no time limit. You should set a price that represents what you’d be happy to accept for the property as well as what the real estate agent thinks it is worth. Carefully consider all offers that you receive. They may be over or under the advertised price.
Buyers will often make conditional offers, which rely on them being able to meet certain conditions like selling their own house, securing finance to buy yours, and being happy with a building inspection. You can set conditions too, like a settlement date that is convenient for you. Your agent can negotiate the terms of sale and price on your behalf and make any changes to the sale and purchase agreement.
Before signing any contract, you should always seek your solicitors advice or approval. Once the contract is signed by all parties, you are under contract. Upon all or any conditions being satisfied, and the agreement becomes unconditional, the buyer should pay a deposit (usually 10%) to the Agencys Trust Account.The deposit is usually released after 10 days from the Trust Account, at which point you pay your fees to the agency, and then the balance is released to your solicitor for distribution to you. On settlement date, you are paid the balance of the purchase price and will need to vacate the premises.Once you have received payment and the Agency has received notification of settlement, the keys are released to the purchaser.
When your property is sold by tender, it is not marketed with a price (although a minimum guideline price may be advertised). Buyers make confidential offers to your agent by a set date and time, after which you have a maximum of five days to decide which offer, if any, to accept. You can choose to market your property with or without a guide price. If your property is advertised as “for sale by tender (unless sold prior)”, it means it can be sold before the tender date. The marketing material and tender documents must make it clear if this is the case.
Every tenderer must pay a deposit when they submit their tender. If they are unsuccessful, this will be returned to them. When you have chosen an offer, get your lawyer to review it. Once you accept it, the remainder of the selling process is the same as an advertised price sale. Remember, you are not obliged to accept any of the offers you receive.
A deadline sale/Set date sale follows much the same process as a tender – it is also marketed without a price but with a set end date. However, you can sell the property at any time during the listing period, and when you receive offers, you do so on a standard sale and purchase agreement rather than a tender document.
This is an alternative to advertising with a Price. By negotiation is a method of inviting buyers to make an offer without the seller disclosing what they will accept. This method also includes conditional offers.
An auction is an open process where buyers bid against one another to purchase your property. Before the auction, you must decide on a reserve price, which is the minimum price you are prepared to accept. The auctioneer will work to get you the best price for your property. Bids may start below your reserve price, but once the reserve is met, the highest bidder is legally committed to buying your property immediately. If your auction doesn’t meet the reserve price, you can choose to negotiate with the highest bidder to achieve a sale. You can accept pre-auction offers if the terms of your auction allow it.Auction agreements are an unconditional sale.
It also contains clauses that outline the buyer’s and seller’s obligations and outlines what kind of penalties will apply if either party defaults on the agreement terms (e.g., delaying settlement).
You cannot change your mind once you have signed the agreement and all conditions have been met – you are legally committed to the sale. Before you are asked to sign, the selling agent should give you a copy of the Real Estate Authority (REA) guide (which can be found here).
Are you thinking of selling your home but you’re not sure what it’s worth? Find out how to get a free appraisal from one of our friendly team.
If you are thinking of selling, renovating or refinancing, getting an estimate of your property’s current market value is a great place to start and will assist you in determining your equity position. Our experienced agents will give you an obligation-free assessment and answer any question you have, all at no cost to you.learn more