A time I have been dreading for some time, but am now well into the process of selling the motel.

Many people sell their business, but few sell their home as well, but that is what we are faced with. Now this raises an interesting point, because any agreement 'Sole, Exclusive, Joint' that you make with a broker, is only to sell the business, not the land.

Which brings me on to brokers. I have yet to meet a good one and personally rank them along with car sale people. They really do not want to have to work very hard for the extortionate amount of commission they will earn. If they can push the value of your beloved asset down, by talking about 'bank' expectations, and show a high return, they get an easy ride with the purchaser and the financial institutions.

We interviewed four brokers last week, to find out how they proposed to market and sell our business. Only one came to the table, the other three wanted to sell cheap and provided us with zero confidence. Two thought that we were going to sign up with them then and there and used the old trick of having somebody on their books that was already interested in the motel.

Now one of the questions we fired at them was 'exclusive' or 'joint', to see how the commission rate varied. Three kept the rate the same, but one wanted an extra 1%. The danger of going 'joint', is how hard will they work for you, given any number of others are in the game and they will have to put money up for marketing maybe for nothing?
If you also want the opportunity to sell by 'private treaty', then you need a 'sole' agreement. Again, the brokers don't like this one. You can do this within the 'exclusive', but you must specifically name the individuals you potentially might sell too.

Yes, this is a mind field and you should always let your solicitor have a look over any agency agreement you intend to sign. This is particularly relevant to the circumstances under which the broker will be paid. The fine print. For example you will have to pay the commission if the purchaser pulls out of the deal under contract. So make sure the non-returnable deposit paid is in excess of the broker commission.

Now I have a story to tell about the fifth broker we invited, but I will leave that to a later blog!