How to Read a Real Estate Agency Agreement in New Zealand

April 14, 2026

By

ChCh Property Insight

The agency agreement is the legally binding document that sets out exactly what your agent will do and what you will pay. Here is how to read it, what to check, and what the red flags are.

The real estate agency agreement is the legally binding document that governs your relationship with your agent and their company. It is a significant legal commitment - understanding what it contains before you sign it protects you and ensures there are no surprises during or after your sale.

What an Agency Agreement Must Include

The Real Estate Authority (REA) sets minimum requirements for agency agreements in New Zealand. A compliant agency agreement must include: the agency's full name and license number; the property address; the agreed sale method (auction, deadline sale, price by negotiation, tender); the listing price or reserve price; the agreed commission structure including any administration fees, expressed as a total amount where possible; any marketing costs and who is responsible for paying them; the duration of the agreement (the agency period); and the conditions under which commission is payable. The REA requires agents to provide you with the REA Agency Agreement Guide before you sign - this plain-English document explains your rights and what the agreement means.

The Duration Clause

Every agency agreement specifies a duration - the period during which the agency has exclusive or general rights to market your property. Standard Canterbury agency agreements typically run for 90 days. During this period, if your property is sold - by the agency, by you, or by anyone else - the commission may still be payable to the agency depending on the agreement terms. Read this clause carefully. Understand what happens if you want to change agents before the agreement expires and what notice is required.

Commission Terms - Check Every Detail

The commission section should specify: the percentage or flat fee; which portions of the sale price each rate applies to; the administration fee if any; whether GST is included or additional (it is always additional); and the conditions under which commission becomes payable (unconditional sale is standard). If there is any performance bonus or tiered commission structure, it should be spelled out clearly here. Do not accept verbal descriptions of commission terms - they must be in writing to be enforceable.

Marketing Costs

Marketing costs are a separate budget from commission. The agreement should specify which marketing activities are included in the commission, which are additional, who approves additional spending, and how costs are managed. Some agencies include photography and basic advertising in their commission. Others charge these separately and can add $1,000-$3,000 or more to your selling costs. Understand exactly what you are committing to before signing.

Red Flags to Watch For

Watch for: agreements with unusually long durations (more than 120 days); clauses that make commission payable even if the property does not sell; vague marketing commitments without specifics; lack of clarity on who pays marketing costs if the property does not sell; and any verbal promises not reflected in the written agreement. If anything in the agreement is unclear, ask for clarification in writing before signing. Your solicitor can review the agreement if you want professional guidance.

Agency agreement information from the Real Estate Authority (rea.govt.nz), Settled (settled.govt.nz), and Agent Finder NZ. For general information only. Always consult a legal adviser if you have questions before signing.