8 Important items that must be clearly stated in the property agent agreement
A property agent contract is important for those who are interested in selling real estate or using the services of a property agent. So let's get acquainted with the property agent contract.
What is a property agent agreement?
A property agent agreement or real estate agent agreement is a reciprocal contract in which one party wants to sell the property and the other party is a real estate agent whose duty is to bring the real estate to be offered for sale to the buyer and eventually lead to real estate trading.
This contract is legally binding between the seller and the broker, with both parties obligated to treat each other fairly.
When a property consultant successfully performs their duties, which includes the sale of real estate as specified in the contract, the seller is required to compensate the real estate agent.
When a property consultant successfully performs its duties, the sale of real estate is specified in the contract.
What are the details of property agent contracts?
Details are stated on the property agent contract. It consists of 8 main parts, which the contract may be alternated as follows:
1. Details of the contract
This section usually appears at the beginning of the contract stating where and when this contract was entered into.
2. The seller or the contract giver
This section specifies the seller's information, including name, surname, age, and address, and establishes who will be referred to as the seller or contract giver in the contract.
3. Real estate broker or agent
This section contains information about your property agent, including the property agent's first and last name, age and address, which will be replaced by the word agent when it appears in the next section of the contract.
4. Real Estate to Sell
The location of the property to be sold is described in detail in this part, including the house number, village, street, road, sub-district, district, and province.
5. Property agent's Remuneration
This section requires extra attention, since it details the remuneration property agent will receive from the sale of the property in accordance with the terms of this contract. By stating the quantity, both numbers and letters must match.
In addition, the form and payment options, such as the payment method or location, the number of installments, and the precise payment schedule, will be indicated. Most importantly, the withholding tax must be brought up.
6. Terms of Contract
This section details the initial period during which this agreement became effective and legally binding between the parties, including the extension of contract period that they must notify each other within how many days before the end of the contract. A new contract must be made after the terms and conditions are agreed upon.
7. Conditions and Exceptions
This section outlines the circumstances or exceptions that result in the payment of compensation when no real estate transactions are made or lead the seller to withhold payment, including the breach of contract of each party that will result in the contract specified.
8. Declaration of intention to establish a legal relationship
The signatures of both parties and witnesses are required in this section, which is located at the end of the agreement, for the document to be legally binding. The seller, or contract giver, is the first party. The property agent is the second party and 2 witnesses sign. The contract is then kept by the broker and seller for a single set each.
Summary of agent contract
| Details | Requirements |
| Contract details | Place and date-time of contract |
| Seller details | Name-surname, age, address |
| Details of Property agent | Name-surname, age, address |
| Real estate details | House number, village, soi, road, subdistrict, district and province |
| Property agent compensation | The amount in both numbers and letters. |
| Contract period | The start-end time period |
| Other conditions | As agreed, such as in the event of breach of contract |
| Expressing intent to create a legal relationship with each other | Sign the name of the seller, broker and 2 witnesses. |
Should I contract a property agent or not?
Problems arising from the non-contracting of the property agent are the ambiguity about the compensation, including the amount of payment, due date to be paid, withholding taxes, and the end date of the agent’s responsibility. The aforementioned lack of clarity causes the inconsistency in working with each other.
By having a contract, all parties are able to fully understand the issues from the beginning and avoid disagreements after deciding to utilize the services of a real estate agent. Therefore, working with a broker, the seller should bind a contract with a property agent.
If you have any further questions or concerns about buying, selling or renting real estate, you can contact the PropertyScout team by clicking here. The team is willing to help answer all inquiries.
