Agency agreements

The real estate salesperson you choose to sell your house will ask you to sign an agency agreement.

An agency agreement is a legally binding contract. Before signing make sure you have read and fully understood it and get your lawyer to check it. Your salesperson must recommend that you get legal advice before signing an agency agreement.

Agency Agreement Guide

Your salesperson must give you a copy of the Agency Agreement Guide​ and ask you to confirm in writing that you have received it. You should read this guide before you sign the agency agreement.

Download the Agency Agreement Guide (.pdf 170KB)

The guide is available in a number of languages from the Forms and Publications section.

Choose an agency agreement type

If you list your property with one agency, you’ll usually sign a sole agency agreement. If you list your property with two or more agencies, you’ll usually sign a general agency agreement. If you’re thinking about listing your property with more than one agency, it’s very important that you read the agency agreements carefully. Make sure you understand when, how, and who you’ll have to pay commission to when your property sells.

Sole agency agreement

This agreement gives one agency the exclusive right to market and sell your property. Once you’ve signed a sole agency agreement, you shouldn’t sign another agency agreement with anyone else. If you do, you may have to pay each of the agencies a commission when your house sells. 

General agency agreement

This agreement gives more than one agency the right to market your property. You’ll sign a separate agency agreement with each agency, but you’ll only pay a commission to the agency that introduces the buyer who eventually buys your property. Your lawyer can advise you on this.

Discuss everything carefully with your salesperson

Before signing an agency agreement with you, your salesperson must do all of the following things:

  • Give you a written estimate of your sale price. This must reflect market conditions and be supported by information about sales of similar properties.
  • Discuss the different methods for selling your property. You can choose to sell at an advertised price, or by tender, auction, or deadline sale. Your salesperson must tell you how the option you choose affects the commission you’ll pay them.
  • Give you a written estimate of the commission. They must tell you how they’ll calculate the commission and when you must pay it by. 
  • Give you a copy of the New Zealand Residential Property Agency Agreement Guide. They’ll also ask you to confirm in writing that you’ve received it. 
  • Explain how they’ll market your property and how much the marketing will cost. Some marketing may be free, but you may want to pay for additional advertising. (You usually have to pay upfront).
  • Explain the risk of paying two commissions. This is a risk if you enter into more than one agency agreement.
  • Give you the opportunity to seek legal advice before signing an agreement. You should take this opportunity. Making sure everything’s in order at this stage could save you problems later.

Negotiate the agency agreement

You should only sign an agency agreement when you’re happy with it. You can negotiate what’s in the agreement, including:

  • which method the salesperson will use to sell your house
  • how long the agreement will last
  • how much commission you’ll pay
  • what expenses you’ll pay (for example, for advertising, or to get a LIM report or a building report).

Standard clauses

Real estate agencies can choose to use standard clauses in their residential and rural agency agreements. These clauses help protect you by making clear: 

  • when the agreement ends
  • when you need to pay a commission.

We recommend you only use agencies who use these standard clauses. Ask your salesperson about the clauses before you sign, or get a list of agencies using them, here​​.

Find out about cancelling the agency agreement 

Make sure you know how long the agreement lasts and when you or the salesperson can cancel it. You can negotiate this with your salesperson. 

If you change your mind immediately after signing a sole agency agreement, you can cancel it by 5pm on the first working day after the salesperson has given you a copy. You must cancel in writing (for example, by letter or email). You won’t have any further obligations to the agency.  

However, if you enter into the agreement and decide to cancel later, you must understand your obligations. For example, if the salesperson has already done work that helps to sell the property, you may have to pay them a commission (even if you cancel the agreement and sell your property privately).

When a general agency agreement is cancelled your salesperson must give you a list of people they have introduced. If you then sell to one of these people, the salesperson is entitled to a commission.​

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