Information to clients

Your client is usually the person selling a property, but the Estate Agents Act 1979 also applies when you are instructed to find a property for a buyer.

You must give potential clients information about:

• fees and charges
• services to potential buyers
• your terms of business.

You must do this in writing as soon as possible, and it must be done before you agree to act for the client.

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Fees and charges

This is the essential information that you must give potential clients in writing in advance:

• all the circumstances in which you will charge an agency fee. This includes any fees or charges that you will make if the property is taken off the market without a sale
• the amount of your fee. If you aren't sure at the time, then how you will calculate it
• details of any other charges on top of your agency fee
• any other circumstances in which the client would have to pay an additional fee
• the amount of any additional fee or, if you don't know it, an estimate, plus details of how you will calculate it.

Additional charges

You must provide your client with a detailed breakdown of any additional charges, even if they are estimated rather than actual. You cannot just show a total figure.

If you find it difficult to cost some items, you can estimate them. For example, you might not be sure about your advertising costs, because they will depend on how long it takes to sell the property. In this case, you could give your client an estimate. Your client may not always accept an estimate and may prefer to have a firm quote.

Producing an estimate of charges

Your estimate must clearly state what it is for, and it should give your client a rough idea of the maximum amount payable. When you put your estimate in writing, you can say that it is 'an estimate of £X, that will not exceed £Y, without client approval'.

For example, if you produce a special brochure for a client, you must tell them how much it will cost to produce a specific number of copies. If you need extra copies, then you must ask your client to approve the additional charge.

Getting client approval to changes

If you have to make an additional charge, you must write to your client to get permission first.

If there are any changes to other important information, you must write as soon as possible and get your client's agreement.

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Services to potential buyers

You must tell a potential client if you or a connected person might offer any services to the property buyer. This must be done in writing before you agree to act for the seller.

You don't have to tell the seller how much you will be paid for services to the buyer.

You will have to be specific about the service you might offer a buyer. For example, you might arrange:

• a mortgage
• insurance
• the sale of the buyer's property
• a removal service.

If you or a connected person will benefit from services offered by any other person in connection with the sale, then you must tell your client about the service. For example, if you get a commission from someone you recommend to the buyer, you'll need to write to your client. Again, you don't have to reveal how much you will be paid.

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Terms of business

You will have to write to your client to explain what these terms mean, if you plan to use them in your contract:

• sole selling rights
• sole agency
• ready, willing and able purchaser.

If you use different words that have the same meaning, you should still use the relevant definitions to explain your terms to the client.

Definitions

We recommend that you use the relevant definitions in full. If they could be misleading for any reason, you must make sure that any alternative definitions accurately describe the client's liability to pay.  

Back to: Estate Agents Act