What is a listing?
While we generally tend to think of a listing as the advert for a property that is for sale or for rent, the listing actually refers to the listing agreement that is made between a principal and an agent, regarding marketing of a property.
What is a listing agreement?
The listing agreement is an employment contract, which authorizes an agent to act on behalf of a principal.
This agreement generally includes:
– the length of the listing period
– the desired sales price (perhaps also include a minimum to maximum range)
– the amount and distribution of commission, for example how much (%) for the listing broker and how much for the selling broker
– any possible exceptions to the commission, such as a reduced fee for preferred buyers
What are the types of listing agreement?
– Open listing – whereby the seller reserved the right to employ any number of agents. Therefore, the listing agreement is non-exclusive, and the selling agent is the only one who receives commission (unless the seller manages to sell the property independently, in which case no commission is paid)
– Exclusive agency listing – whereby the seller contracts one broker to act as exclusive representative for the sale of the property. However, the seller can still retain the right to sell the property independently (but not through a different broker).
– Exclusive right-to-sell listing – Only one broker has the right to represent the property and also has exclusive rights to the commission of sale, meaning that the broker gets paid, no matter who sells the property, while the agreement is in effect.
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