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How to Cancel Your Contract With an Estate Agent

Zenyx Griffiths

Written by Reviewed by Graham Norwood

2nd Jul 2020 (Last updated on 27th Jul 2021) 9 minute read

How to Cancel Your Contract With an Estate Agent

Many contracts can seem lengthy and complex at first. However, it is possible to cancel your contract with an estate agent, depending on the contract type signed. It’s important to note that you may incur a cancellation fee so it’s vital you read through the paperwork thoroughly.

There are a variety of reasons sellers may want to cancel their contract with an estate agent, from pulling out of the property sale to switching agents. However, there are certain clauses you should be aware of before doing so as they may not allow particular actions.

Compare My Move work with a number of professional finance and property experts to create articles that will successfully guide you through the selling process. In this article, we will discuss the different contract types available, how they’ll affect your cancellation process and what you should look out for when signing another.

What are the Different Types of Contract Available?

Before we discuss cancelling a contract with your estate agent, it’s important to know the different types of contract available. This will help you better understand the cancellation process and what penalties there could be if you continue to do so.

There are four different types of contract with estate agents, and you must ensure you know which one you are entering into. Unfortunately the agent may not make it clear at the outset so you may have to ask. The four are:

  1. Sole selling rights - A less popular type of contract, this means that you are bound to the agency fees even if you find a buyer yourself. You will not be allowed to instruct another estate agent.
  2. Sole agency - This type of contract means you cannot instruct another estate agent. However, you will be allowed to find your own buyer without having to pay the agent a commission.
  3. Joint agency - This is where you sign up to two agencies at the same time with the permission of both agents. They may decide to share the commission regardless of which agent actually sells the property - the split of the commission is typically decided by the agents themselves, not the seller.
  4. Multiple agency - Typically the more expensive option, this contract allows you to instruct as many estate agents as you like. The agent who sells the property is the one who then earns the commission.

It’s worth bearing in mind that well over 90% of sellers first look for a property online, usually on a property portal like Rightmove or Zoopla: searches on these websites are done by sellers specifying the area they want to move to, the type of property they want and the maximum price they wish to go up to. The portals then display properties which fit those criteria.

So while in the days before the internet many sellers used more than one agent to maximise their coverage, nowadays most sellers use just one agent - ensuring that the agent in question advertises on Rightmove, Zoopla or preferably both.

How Much Will You be Charged to Cancel?

The charge you’ll face for cancelling will ultimately depend on the type of contract you’re in. For example, a sole selling rights contract may cost more as you’ll have to pay all of the estate agent fees even if you find a buyer yourself.

Some estate agents may even insist that they should be paid if they simply introduced you to a buyer who purchases your property within 6 months of your contract ending. If an agent suggests that you should pay them no matter how long after the contract is terminated, it can be challenged under the Unfair Terms of Contract Regulations 1999.

If you decide not to sell or if the transaction falls through, you may still have to pay some of the agent fees such as marketing and advertising costs. If you then choose to go with another agent, it’s advised not to pay any fees upfront as a sale can never be guaranteed. This would only increase the cost of selling a house without any guarantee of success.

If you’ve found an estate agent offering a ‘no sale, no fee’ service, then you won’t have to pay if the sale has fallen through. But there may be other penalties for cancelling the contract early.

Ultimately, the cost for cancelling is down to the contract type and the fine print added within. Read your contract carefully when choosing an estate agent and when deciding if cancelling is the right step for you.

What if You No Longer Want to Sell?

Previous research conducted by YouGov discovered that around 300,000 property transactions collapse every year. It also showed that a third of UK homeowners are reluctant to sell their homes due to the risk of the property chain breaking down.

With this data in mind, it’s understandable that some sellers will change their mind and pull out of a sale early. Depending on your contract, you may not encounter additional charges for pulling out of the sale. But you will likely have to pay the general fees for advertising and marketing. Read your contract thoroughly before continuing.

It’s important to note that you may be charged extra if your estate agent introduced you to a buyer before the cancellation. If this buyer made an offer but was unable to buy due to the property being taken off the market, you may still have to pay the estate agent for their work.

What if You Find Another Estate Agent?

Research conducted by the Department for Business, Energy and Industrial Strategy in 2017 found that, overall, satisfaction with estate agents was high amongst UK sellers. Around 84% of sellers were happy with their transaction and of the small number who were dissatisfied, only a third went on to complain about their estate agents.

However, despite this, 18% of experienced sellers were more likely to change estate agents to increase their chances of a sale. The most common reason for this change was the lack of house viewings the property was receiving.

If you find yourself in this position, it’s recommended that you first read your contract. Sole selling rights and sole agency contracts will not allow you to instruct another estate agent and you may be charged for cancelling. Joint or multiple agency contracts allow sellers to instruct more than one estate agent and so it may help you avoid cancellations fees.

Before you decide whether to cancel your contract, speak to your agent directly as they may be able to ease the concerns you have. If they’re capable of resolving any issues present, you may not need to cancel. You will still have to pay the general charges for marketing and advertising so speaking to your agent could mean avoiding a cancellation fee or paying and choosing another estate agent.

If the agent is aware of your issues and does not work to resolve them or doesn’t deliver a successful solution, there may be grounds to end the contract. However, it’s advised that you seek legal advice before doing so.

What if You Find a Buyer Yourself?

According to the HomeOwners Alliance, 6% of estate agents in 2018 couldn’t find a buyer for their clients. Although a small percentage, it does mean that some sellers have ventured out and found prospective buyers themselves.

If you are one of these sellers, be aware that you may still have to pay the agency fees depending on what type of contract you have signed. Read the fine print carefully and browse your contract before continuing.

In some cases, sellers are able to cancel without owing money if they’re able to prove that their estate agent did not introduce them to the buyer. Document any and all contact you have with the buyer in case this opportunity is available to you.

Is it the Same Process to Cancel Online Estate Agent Contracts?

Property consultancy TwentyCi says that, as of mid-2019, online estate agents were accountable for 7.3% of all property exchanges.

Online estate agents are clearly still quite popular and so it’s wise to research what contracts or terms and conditions they offer before deciding to work with one.

Some may seem straight-forward and act as advertising portals, whilst others offer more traditional services. However, many online agents will not work on a ‘no sale, no fee’ basis - instead they expect payment upfront, and it would be non-returnable if a sellers is not found - and so it’s important to do your research.

Some, however, may offer ‘no sale, no fee’ services but it’s not commonplace. Instead, some online estate agents will ask you to pay an upfront fee, which may be cheaper compared to high-street estate agents.

If this is the case, you could be faced with a cancellation fee on top of the amount you’ve already paid.

What to Look Out for When Reading Your Contract

Before you hire or switch estate agents, you should carefully scrutinise the contract. Read the small print before signing and understand what contract type they are actually offering you. Ask your estate agent questions and look out for these important factors:

  • Type of contract - Use the information above to determine which contract type is right for you. Be wary of sole selling rights contracts as you will have to pay the estate agent even if you find a buyer yourself. Also, keep in mind that multiple agency contracts are typically the most expensive.
  • VAT - Some agents will advertise their fees without including the VAT VAT - even though, by law, they should publicise this. Remember to ask for a full breakdown of the quote before accepting, as not all agents include it in their price.
  • Fixed-rate commissions - Some estate agents work on a fixed commission basis which will work out an exact budget for their fees - whether they sell or not, and irrespective of the effort they put in to find a buyer for your home. This may not always work in your favour as it could discourage your agent from getting you the best price on the property as they will be paid the same regardless.
  • Tie-in periods - Many estate agents will include a tie-in period in their contract. It is usually around 6 weeks, with a notice period of between 1 and 4 weeks. Make sure the contract gives you flexibility so if you’re unhappy with your agent, you have the freedom to cancel without incurring a penalty. Some contracts have longer tie-in periods and so it’s vital you check before signing.
  • Cancellation fees - As previously stated, it’s important you read your contract carefully and to find out if you’ll receive a fee for cancelling your contract or for switching agents.
  • Hidden fees - Don’t forget to search for any added fees not previously stated by your agent. Often these will be charges for press advertising or a hard-copy brochure. Any added charges will need to be agreed with you in writing before being valid.

Saving Time and Money During the Selling Process

As this article shows, it’s important to shop around and find the right professionals for the job. That is why Compare My Move only works with the best in the business, ensuring you find the most trusted professionals in your local area. We can connect you with verified surveyors, conveyancers and removal companies to ensure a smooth moving process.

Rest assured, we carry out a strict verification process with every partner in our network, giving you extra peace of mind that you’re in good hands. We’ll even help you save up to 70% on the cost of moving house!

Zenyx Griffiths

Before Compare My Move, Zenyx once wrote lifestyle and entertainment articles for the online magazine, Society19 as well as news articles for Ffotogallery.

Graham Norwood

Reviewed by Graham Norwood

Property Journalist and Editor,

With over 15 years of experience in residential property journalism, Graham is currently the editor for both Estate Agent Today and Letting Agent Today.

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