Ban unfair contracts with estate agents!

Homeowners shouldn’t be forced to pay fees to estate agents unless they have actually sold their home

Most estate agents have contracts that are fair. But a minority have contracts that are very unfair, and can compel homeowners to pay the estate agent fees even if they don’t actually sell the house. This can land homeowners with bills of many thousands of pounds through no fault of their own – on top of failing to sell their home.

The majority of estate agents have contracts where their fees only become payable when contracts between buyers and sellers are exchanged, which effectively makes the sale a legal certainty. However, some estate agents have contracts that stipulate that homeowners should pay their fees – which can be as much as 3% of the value of the house – only when the estate agent has found a “ready, willing and able purchaser.”

This means that the homeowner has to pay the agent’s fees after agreeing an offer with a buyer, so long as the buyer doesn’t pull out. If the seller pulls out, for whatever reason, they are still liable to pay the agent’s fees. But often sellers have to pull out for no reason of their own – if they lose their job, if the person they are buying from pulls out, if the survey shows the house they are buying is about to fall down. If it is a 3% fee (excluding VAT) on a £500,000 home, they could be forced to pay the estate agent £18,000 out of their pockets.

The HomeOwners Alliance strongly recommends that homeowners never sign such contracts with estate agents. For more on our advice to homeowners, click here

But we also want such unfair contracts to be banned, so that estate agents can no longer offer them. In particular, that means:

  • Estate agent trade associations should require their members to abandon such unfair contracts
  • Industry ombudsman and trading standards offices should not enforce such unfair contracts
  • The government should ban the use of such contracts

Have you been caught out by unfair contracts with estate agents? If so, we would like to hear from you – please email us in confidence at

Please leave your comments below

I was considering putting my property on the market through Express Estate Agents, and as they wanted to come round during the daytime to value my property, my girlfriend went round to my house to show them round. They discussed with her how they would go about selling the property, and asked her to sign the agreement. She told them that she did not own the house, and had never even lived there, but she was told that it didn’t matter about her signing as it was just so they could prepare the paperwork. I then had to change plans, as I thought my daughter was going to have to come back to live at home for a while. I was told that if I cancelled the contract, I would still have to pay the fees. I told them that as I had not signed any contract myself with them, that I did not feel that I should have to pay them over £3000. They then said that if I did not pay up, they would have to go after my girlfriend and make her pay instead. Can you tell me if they can enforce this please. I have since decided that I do want to sell my house, and have been approached by a neighbour, who wants to buy the property. I do not want anything more to do with Express Estate Agents due to their underhand practice, and threatening behaviour.

  • “If it is a 3% fee (excluding VAT) on a £500,000 home, they could be forced to pay the estate agent £18,000 out of their pockets.”

    You’re over-inflating the fees to sway sentiment in your favour. Average EA fees in E&W according to the OFT – 1.6%. Average house price in E&W according to BBC in Feb 2014 – £166,874. Taking these averages, that would yield a fee of £2,670.

    Not as headline-grabbing as £18,000, is it?

    “often sellers have to pull out for no reason of their own” – yes, this is true, but it’s also apparent that in the situation where fees are only payable on successful sales, any sale which flounders through no fault of the agent still leaves the agent shouldering all their own expenses on that property sale for no reward.

    I suggest that a contract where marketing costs and outlays are recoverable via an exit fee (not a full fee) if the seller withdraws from their contract with the EA is quite reasonable. If the EA terminates the contract, no fee is payable.

  • I have just signed a contract with Express Estate Agency and am wondering, is there a cooling off period with the contract?

  • I got divorced three years ago and we put the house for sale.after three years I decided to bay my wife share of the house and got a bill off the estate agent of £2160 for bying my own home is this right.

  • I sold my house through express estate agency.

    Full of lies they are.

    Undervalued my property.

    No communication.

    Different person everytime

  • I have sent an e-mail regarding my problem with express estate agency who are taking me to court as they are saying I owe them fees because I took property off market then later sold it privately

  • We recently withdrew our property from our one-branch local agents after being on the market for more than five years, with no offers. We were never informed of adverts placed, brochures sent out, customer matching, or enquiries on our property, and our Rightmove reports went missing for years – we received a random one after making a telephone complaint (we’d actually forgotten what they were). The agency accepted our request to withdraw through our dissatisfaction, then billed us for around £370 as part of their no-sunset clause penalty fee. Our contract was removed on the day we signed it (when the photos were taken, before a brochure was prepared) and not given to us again until we questioned the bill, five years and two months later. We refused to pay, and have now been summoned to small claims court. During the process of researching our defence, we discovered that this agent encourages customers to sign on the day, ahead of a brochure being produced. The valuer then returns to the office, manually feeds the signed contract into a printer, and seamlessly adds a valuation fee. This makes it appear as though the contract was left with the customer whilst a brochure was being approved, and that the customer signed in full knowledge of the terms. A busy city agent might not get away with this, but our area is rural, and we are served by two single-branch family-owned agencies, which makes it very easy for them to mislead us. It is common practice for customers to tell this particular agent that they are definitely going with them when the valuer arrives to photograph the house, hence making it relatively simple for the valuer to get a contract signed immediately. My contract was pushed at me with no explanation of terms. I feel foolish for not realising how carefully I needed to protect myself – I thought the days of rogue traders were over. I signed, the contract was removed immediately, and the rest is history. The barefaced arrogance of an agent who breaks the law and then summons ME to court is something I’m finding hard to stomach. I’ll happily post an update here as we undertake the process. Yes we have filed a defence (today) and two counterclaims; my husband received a separate summons, despite the contract having been signed by me alone. All advice gratefully received – we don’t have a solicitor, we are defending ourselves in court.

  • There takimg me to court today
    I put my house up for sale with they they told me my house would sell within the next 2 weeks how untrue was this
    I got calls of a guy call paul i think ut was every day sometimes 3 or 4 times badgering me to lower my asking price as i have more people interested after around 5 days of these call while i was a work as well as home I gave in
    The put my house on at a guide price of 80k knowning i could except anything less than 85
    I had 2 ladies view my property in 2 months which amounted to nothing then i had one lady come round and fell in love this was on a Sunday bare in mind the offfer you 24/7 service
    The lady offered which she thought was the full asking price i had to explain to her this was all wrong and we sat down and talked about things after discussing this we finally got to the price i needed and exchange solicitors nowhere in any of the negotiations did express estate agent have anything to do with the sale apart from badgering the buyer to the stage she nearly pulled out i made a complaint and they offered me £250 of the bill of nearly 3k so i never paid it now im where i am in court for charges for work they didn’t do
    What a joke

  • Hi Marie,

    Sorry to hear about the problems you’ve been having.
    Do consider joining us a member and one of our property experts would be more than happy to look into your query. The membership package includes access to a legal advice line (first call is free). Joining is easy and only costs £45 for the year. Sign up easily here.

    Kind regards,

    HomeOwners Alliance Team

  • My estate agent found a buyer who’s offer I accepted, however after 4 months of waiting his mortgage in principle has just been declined so he is not in a position to purchase. I am now wanting take the property off the market and to cancel my contract with this estate agency but they are saying I still owe fees and threatening me with court action. How can I owe fees if the buyers mortgage application has been declined??

  • Hi Katherine
    If you’d like us to look at your contract and help signpost next steps and hopefully fight this claim, we’d be happy to help. Just join us today and send us your contract and correspondence with the agent and we’ll advise.

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