Exclusive and Open Mandates Explained

by Lien Joubert • 4 MIN • 821 Words

Mandates Explained:
When selling a property through a real estate agent, sellers typically have two main options for granting the agent the authority to sell their property: a sole mandate and an open mandate. Let me explain the key differences between the two:

Sole Mandate:
When a seller chooses to sign a sole mandate with a real estate agent, they are granting that agent exclusive rights to market and sell their property for a specified duration, typically ranging from 3 to 6 months.

In this arrangement, it is the responsibility and governed by legislation of the agent to not only market the property effectively but also to explain to the seller the implications and restrictions of such a mandate. The agent should make it clear that the seller cannot engage with other agents or market the property independently during the mandate period. It's important for the agent to ensure that the seller fully understands these restrictions and is willing to comply with them. Furthermore, the agent must provide the seller with a written copy of the sole mandate, outlining the start and end dates, to maintain transparency and clarity.

At Commerci Properties, we also advise sellers to discuss commission sharing with the agent to maximize the chances of a positive sale. Some agents may be willing to share the commission with other non-mandated agents, which can result in increased exposure and more potential buyers for the property.

At Commerci Properties, we understand the importance of trust and dedication in this process and are committed to delivering the best service with or without an exclusive mandate.

Restrictions: The seller is bound by an agreement that restricts them from engaging with other agents or marketing the property independently during the mandate period. They are essentially entrusting the sale of their property to a single agent or agency.

Duration: The sole mandate will specify a duration during which the agent has the exclusive rights to sell the property. This period is negotiable and can vary but is typically around 3 to 6 months.

Commissions: The mandate will also outline the commission or fees that the agent is entitled to upon a successful sale. These terms are usually negotiated between the seller and the agent.

Benefits: The main benefit of a sole mandate is that it provides the agent with a higher level of commitment and motivation to sell the property, as they have exclusive control over its marketing and sale.

Open Mandate:
In contrast to a sole mandate, an open mandate grants the seller the freedom to engage multiple agents or market the property themselves simultaneously. With an open mandate, competition among agents and possibly the seller becomes a prominent feature.

Agents have the responsibility of devising innovative marketing strategies to stand out in this competitive environment. Effective communication with the seller remains vital, as agents need to provide regular updates on marketing efforts, potential buyer interest, and any offers received. It's essential for sellers to understand that the property will remain on the market until it is sold or until the seller decides to withdraw it.

Cooperation with other agents is also possible in this scenario, which can be advantageous for the seller.

At Commerci Properties, we ensure that, regardless of the type of mandate chosen, our commitment to delivering the best service and support to our clients remains unwavering. We are here to guide and assist you in achieving a successful property sale, whether through a sole mandate or an open mandate.

Regardless of whether you choose an open mandate or a sole mandate, at Commerci Properties, our dedication to providing top-notch service remains consistent. We are here to serve you and ensure a smooth property sale experience.

Flexibility: Sellers have the flexibility to work with multiple agents and explore different marketing strategies simultaneously. However, this can also lead to increased competition among agents.

Commissions: In an open mandate, sellers may negotiate terms and commissions separately with each agent they work with, and only the agent who successfully sells the property is entitled to a commission.

Duration: Open mandates do not typically have a fixed duration, and the property remains on the market until it is sold or the seller decides to withdraw it from the market.

Benefits: The primary advantage of an open mandate is the flexibility it offers to sellers. They can test the effectiveness of different agents and marketing approaches.

In summary, a sole mandate in South Africa gives one agent or agency exclusive rights to market and sell the property for a specified duration, while an open mandate allows the seller to engage multiple agents or market the property independently. The choice between the two mandates depends on the seller's preferences, the property's marketability, and the level of trust and commitment they have in a specific agent or agency. It's important for sellers to carefully consider their options and the terms of the mandate before making a decision.

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