Are Sole Mandates good or bad?

Sole and exclusive selling mandates are often advocated by real estate agents. But this practice needs to be interrogated to find out in whose interest such a mandate really is..

It obviously is in the interest of the estate agent who comes with a well-prepared presentation in order to convince the seller to grant a sole mandate that prevents other estate agents and the seller him/herself from selling the property.

The seller’s goal is ultimately to sell the property in the shortest possible time at the best possible price and with the least inconvenience.  The seller must therefore decide on the best possible route to obtain these goals and in so doing, should consider the salient facts surrounding the granting of a sole and exclusive mandate, a joint mandate with two or perhaps three agencies or an open mandate to many. The issue to consider is: past sales resulting directly from sole mandates and then also the prices obtained in relation to the asking price as well as the time frames within which those sales took place.

Truth is, if a property is marketed by one estate agency only, it results in increased exposure for the real estate company and in turn the agent uses the well exposed brand to gain more sole mandates. A good strategy…for the agent!

If the agent requires a sole mandate for brand exposure and to control the available stock (of which there is currently a shortage in most areas), then sole mandates are being canvassed for the wrong reasons. This strategy also causes many sole mandates to be signed at inflated prices, resulting in longer marketing and sales periods.

In essence a sole mandate may be the correct route for the seller if it is granted for the right reasons, i.e. so that the mandate can be serviced in the most efficient manner in order to provide the best possible service to the seller. We believe that a sole mandate is the necessary route to take when there is a committed and serious seller, with a property  that is objectively priced to sell and is a saleable property in terms of supply and demand. If not, a quick sale is highly unlikely.

For further information, kindly contact Pam Snyman at 021 881 3311, or any of the REDZetc agents in your area. Visit their website www.redsproperties.co.za

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