In this article, we’ll break down what a mandate is, the different options available, and key factors to keep in mind when signing one to help you navigate the process with confidence.
What Is a Mandate?
A mandate is a written agreement between a seller and an estate agent that gives the agent permission to market and sell the property under agreed terms.
It outlines the working relationship between the agent and seller, including each person’s responsibilities and how the sale will be handled. The mandate doesn’t have to be complex, it just needs to be clear.
Why Are Written Mandates Non-Negotiable?
According to South African property law, no agent may market a property or introduce buyers without a mandate signed by the seller. This is a safeguard that protects everyone involved, clarifies expectations, and helps avoid issues down the line.
Since February 2022, it’s also compulsory for every mandate to include a Property Condition Report. This document details the state of the property as declared by the seller.
Different Types of Mandates
There are three different types of mandates that sellers can use. None of these options are a one-size-fits-all, and the right choice depends on your goals, timeline, and comfort level with how the property is marketed. Let’s take a look at what those three options are.
1. Open mandate
An open mandate gives sellers the freedom to list their property with multiple agents at the same time. While getting as much exposure as possible may sound appealing, there are disadvantages.
For example, without a single agent managing the process, you may need to deal with inconsistent communication, duplicate listings, and confusion among buyers.
2. Joint mandate
With a joint mandate, two or more agents are appointed to market the property. This option combines the wider reach of an open mandate with more structure.
The chosen agents often work together to develop a shared marketing plan, resulting in a focused and collaborative effort.
3. Sole mandate
A sole mandate gives one agent exclusive rights to market and sell your property. This is often the most efficient approach, especially when working with a trusted and experienced agent.
Important Factors To Keep in Mind
Clarity and communication
A successful property sale starts with a clear understanding between the seller and agent. The mandate outlines all the key terms, including how your property will be marketed, what fees apply, and how long the agreement will last.
This helps to build trust and avoid confusion later on.
Protect yourself with an exclusion list
If sellers have already shown the property to potential buyers before signing a mandate, list their names in the agreement.
This is called an exclusion list and protects sellers from paying commission if one of those buyers ends up purchasing the property after the mandate is signed.
Work with a licensed professional
Sellers should always verify that agents are registered with the Property Practitioners Regulatory Authority (PPPRA). A licensed agent is legally accountable and trained to meet industry standards while adhering to a strict code of conduct.
This ensures sellers are dealing with professionals who will act in their best interests and guide them through the real estate process.
Set The Right Foundation for Your Property Sale
Navigating the real estate process can be tough, but that’s why the RE/MAX Living team is here to help! Whether you want to sell your home and need help setting up a mandate or want to work with a reputable real estate agency, we’ve got you covered. Reach out to our experienced property professionals today to see how we can help you make your property dreams a reality.