As there are different types of properties and property needs, there are different types of property agencies in Malaysia. Knowing who they are will help you decide which is the best option to turn to. These are:
1) Exclusive Agency
1a) What are exclusive agencies in Malaysia?
When you contract an exclusive agent, it means they’re the only agent who is authorised to sell off your property for you.
Most importantly, you still have to pay their fees when the property is sold off – whether or not they were instrumental in selling off the property.
This is in comparison with sole agents for example, who you don’t have to pay if they were not the one who sold off your property.
1b) What are the pros and cons of hiring exclusive agencies?
The upside of hiring exclusive agents is that they’re likely to give your property a higher priority, given that they’re tied down to it.
Compared to hiring agents on an ad hoc basis, they can typically be more committed.
Keep in mind however, that whichever exclusive agent you appoint on your behalf, they will be the only one in charge of helping you sell your property.
This makes it extra important that you choose a trusted exclusive agent who knows what they’re doing, and can bring a wealth of skills to the table!
2) Sole Agency
2a) What are sole agencies in Malaysia?
Sole agencies are similar to exclusive agencies. They’re still the sole agent entitled to the selling of your property, but you as the client reserves the right to close the deal yourself.
This means that if you manage to sell off your property on your own accord, you’re not obligated to pay the sole agent the full fee.
To circumvent this, usually an allowance for a discount in fees is established, should the client choose to take an active role in the transaction.
2b) What are the pros and cons of hiring sole agencies?
Compared to an exclusive agency, contracting a sole agency can be cheaper as the fee structure provides a little more flexibility. You may get to pay less in commission fees while still enjoying the exclusivity.
The biggest downside is that you’re still gambling on the sole agent to successfully sell off your property for you. As always, you still have to do your due diligence in finding an effective agency.
3) Joint Sole Agency
3a) What are joint sole agencies in Malaysia?
Think of joint sole agencies as two or more sole agencies coming together to join forces.
No matter how many agencies are involved, they must agree to split the fee between them, if one of them sells the property.
3b) What are the pros and cons of hiring joint sole agencies?
The biggest pro to hiring joint sole agencies is that you can widen your scope of potential buyers as each agency brings a new market to the mix.
With multiple agencies involved, and each of them guaranteed a stake in the commission, this type of agency can be beneficial if your property is particularly unique or difficult to sell.
However, you’ll likely be charged a larger price tag upfront since you’re essentially hiring multiple sole agencies at once.
Your conveyancing lawyer should also be meticulous in setting out how the commission will be divided among the agencies.
4) Joint Agency
4a) What are joint agencies in Malaysia?
In joint agencies or multiple agencies, more than one estate agent is appointed, but only the agent who closes the deal gets paid.
However, the number of agents that can be appointed is limited, and each must be aware of the appointment of their counterparts.
4b) What are the pros and cons of hiring joint agencies?
The most obvious advantage of hiring more than one agency is that your property is exposed to more potential buyers, and is likely to be sold off quicker.
The competition between all the agencies involved may even ramp up the rate at which your property is sold off!
Just as with joint sole agencies however, the contracted agencies may charge you a higher fee at the outset.
After all, there’s no guarantee of a commission, they’ve got higher competition with other agencies, and also no exclusivity.
5) Ad Hoc Basis
5a) What are ad hoc agencies in Malaysia?
Also known as “open listings”, the number of agents you can engage are unlimited. Since this is on an ad hoc basis, fees are only paid to the agent responsible for a successful transaction.
5b) What are the pros and cons of hiring ad hoc agencies?
If you choose to hire agents on an ad hoc basis, the good thing is that it may heighten the urgency to sell by creating healthy competition between agents – especially if your property is a promising one.
That same competition may also turn upside down for you, as agents try to undercut one another and undermine your best interest in the chase to seal the deal.
As you’re not contracting any agents to work exclusively for you, agents may not be keen to help market your listing since there’s no guarantee of a commission.
Types of property agencies compared
Exclusive agencies
More committed in marketing your property
Must be effective as they hold the sole responsibility for the sale
Sole agencies
More flexible and affordable fees
Not obligated to pay the full fee if a successful transaction is not obtained
Joint sole agencies
Broaden scope of potential buyers
May be more expensive and complicated
Joint agencies
May be sold off quicker
May be more expensive at the outset
Ad hoc basis
May heighten the urgency to sell your property
No guarantee that you will sell off your property
All of the above and more are regulated by the Malaysian Estate Agency Standards (MEAS) which covers a host of topics ranging from introductions, conduct and ethics to inspection and more.
It is important to be familiar with it, even as a seller, since it will likely eliminate any potential loopholes you may make should you enter into a deal with an agent.
As most experienced agents will tell you however, it all boils down to the agreement made between you and your agent(s).
A lot of research goes into choosing the right agent and lawyer to enable a smooth and successful transaction, so make sure you carry out all the necessary research!
Relevant Guides:
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Who Bears The Bill For Property Agent Fees: The Buyer Or Seller?
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Selling A House in Malaysia: 5 Things That You Need To Pay For!
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How To Set The Right Property Asking Price For Your Home In Malaysia
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