As there are different types of property and property needs, there are different types of property agencies in Malaysia. Knowing who they are will help you decide whom best to contract.
1. Exclusive Agency:
When an estate agent is contracted to act on the behalf of a client. The client may make the introductions to the property but will leave closing of the transaction to the estate agent. Fees between the two are settled in private and the client must pay the estate agent the agreed fee even if the estate agent was not the cause of the transaction.
2. Sole Agency:
This is similar to the Exclusive Agency however, the client reserves the right to close the deal himself and is thus not obligated to pay the estate 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.
3. Sole Joint Agency:
The estate agent and the client work together as a team and the fee is divided on whatever was agreed prior. The client however, can hire and compensate additional estate agents if he so chooses or have one estate agent in control.
4. Joint Agency:
More than one estate agent is appointed but only the agent who closes the deal gets paid. Number of agents that can be appointed is limited though and each must be aware of the appointment of their counterparts.
5. Ad Hoc Basis:
Also known as ‘open listing’, the number of estate agents the client can engage is unlimited as this is on an ad hoc basis and fees are only paid should there be a successful conclusion of the transaction.
All of the above and more are governed by The Standard which covers a host of topics ranging from introductions, conduct and ethics to inspection and more.
It is important to be familiar with the Standard as it will likely eliminate any potential loopholes you may make should you enter into a deal with an agent without realizing the rules that the practice is beholden to.