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Number of dual-fee disputes rising as too many estate agents ‘take a punt’

The Property Ombudsman has warned estate agents to stop carrying on with sales when they are aware that they did not initiate the introduction.

Nigel Lewis

The number of disputes between estate agents over dual fees is rising, so much so that The Property Ombudsman (TPO) has issued new industry guidance.

Levels of cases referred to TPO for adjudication more than doubled from 36 in 2017 to 72 during 2018, a trend that looks set to continue this year, it says.

Dual fees are defined by TPO as those which include both multi-agency agreements, and where a contract is terminated following an initial sole agency agreement and a second agency instructed.

TPO says too many ‘second’ agents which become aware that a buyer may have already viewed the property with the first agent carry on regardless in the hope of getting at least part of the fee, rather than referring the sale back.

Introducer

The ombudsman says it will always be the agent who introduced the buyer who gets the fee, although this must be proved through written evidence of a viewing.

Proof that the viewing took place includes written evidence that it was booked and confirmed to the buyer and seller. But TPO also says that such introductions have a time limit of six months prior to a vendor ending their agreement with the first agent.

It also says that when agents are dis-instructed they must provide the vendor with a list of potential buyers who have viewed the property, and warn the vendor that they will be liable to pay them a fee if any of these buyers then go on to purchase the property.

Katrine Sporle imageOmbudsman Katrine Sporle (left) says the aim of the guidance is to prevent sellers being caught up in unnecessary disputes between agents, which TPO says ‘reflect poorly on the industry’.

March 11, 2019

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