Estate agent exclusivity contract in Spain: everything you need to know

If you’re looking to sell your home, you’ve probably had an estate agent suggest signing an exclusivity contract. This increasingly common practice often raises questions for homeowners – but what does it actually involve?

In this article, we explain everything you need to know about estate agent exclusivity and the key points to consider before signing.

What is estate agent exclusivity?

Estate agent exclusivity is a common clause in brokerage contracts between homeowners and agencies. It grants the agent the sole right to market the property. While the owner may still sell the property independently, they remain liable for the agreed-upon fees.

Are exclusivity contracts legal?

In its ruling 263/2019 of 10 May, the Spanish Supreme Court upheld the validity of such clauses, provided they are drafted clearly, simply and in plain language, and that there is a fair balance between the obligations of both parties.

Advantages of an estate agent exclusivity contract

Homeowners are often hesitant to sign an exclusivity contract, but this option offers several benefits worth considering before dismissing it:

• Total agency commitment: with an exclusivity agreement, the estate agent can commit all its resources to securing a sale at the best possible price in the shortest time.
• Streamlining the sales process: by investing greater resources and effort, the agent can shorten sales timelines and enhance the effectiveness of its marketing.
• Advice to maximise the sale value: the owner will benefit from professional guidance on securing the best price and achieving the most profitable transaction possible.

If you want to sell your house easily, quickly and without complications, look for an estate agent.

What does an estate agent exclusivity contract include?

Before signing an estate agent exclusivity contract with an agency, it is essential to review all clauses carefully and ensure you fully understand them. These are the most common elements in such contracts:

Estate agent exclusivity clause

This is the core of the contract. The clause grants the agency the exclusive right to market the property, meaning neither the owner nor any other agency may take part in the sale. If the transaction is completed without the involvement of the appointed agency, it will still be entitled to the agreed fees. It is essential that the contract explicitly states that this right applies even if the owner sells the property directly or through a third party.

Duration of the contract

Exclusivity is usually set for between three and six months, depending on the property type and market complexity, though it can last up to a year. Contracts often include an automatic renewal clause unless either party notifies the other of their intention not to renew within a specified period – typically one month. This notification must be sent by a reliable method that provides proof of dispatch and receipt, such as a certified fax with acknowledgement and certification of contents.

Customer recognition

This section governs what happens if the sale takes place after the contract has expired but involves a buyer introduced by the agency during the contract term. In such cases, if the buyer is acknowledged by the owner, the estate agent is entitled to its fees even after the contract has ended. This clause must be clearly included and detailed in the agreement.

Collection of fees

The contract must specify the commission amount, usually expressed as a percentage of the final sale price, and state whether VAT is included. It should also clarify when and how the payment is to be made:

• In some contracts, the full commission payment is required upon signing the purchase agreement.
• In other cases, a split payment is agreed: 50% upon signing the deposit agreement and the remaining 50% upon completion of the sale. It must also be clearly stated what happens to the initial payment if the transaction does not proceed.

What should you consider before signing an estate agent exclusivity contract?

Before committing to an exclusivity contract with an estate agent, you should carefully consider several key aspects that can directly affect the sale of your home:

• Review the contract: It’s essential to read all clauses carefully and ensure you fully understand each point before signing.

• Assess how quickly you need to sell: If you need to sell quickly – such as in the case of an inheritance – having an estate agent work exclusively with you can speed up the process, as they will invest more resources to close the deal swiftly.

• Consider how long the home has been on the market: If your property is lingering on the market, an experienced estate agent can help reposition it and boost its visibility, improving the chances of a sale.

• Exclude prior contacts: If you’ve already been in contact with potential buyers before signing the exclusivity contract, you can include a clause exempting them from the agreement. This means the estate agent won’t be entitled to fees if you sell to those buyers.

• Negotiate the contract length: The duration of the exclusivity agreement is flexible. You can agree on a shorter or longer term based on your circumstances and include conditions for automatic renewal or early termination.

Differences between exclusivity and non-exclusivity contracts