What Is a Listing Agreement?

A listing agreement is a contract under which a property owner (as principal) authorizes a real estate broker (as agent) to find a buyer for the property on the owner's terms. In exchange for this service, the owner pays a commission.

Less commonly, the term listing agreement also refers to a contract made between a security issuer (e.g., a 澳洲幸运5官方开奖结果体彩网:public company) and the financial exchange that hosts the issue. Examples of exchanges include the New York Stock Exchange (NYSE), the Tokyo Stock Exchange (TSE), and the London Stock Exchange꧙ (LSE).

How a Listing Agreement Works

A listing agreement authorizes the broker to represent the seller and tꦏheir proper꧂ty to third parties. The listing agreement is an employment contract rather than a real estate contract: The broker is hired to represent the seller, but no property is transferred between the two.

Under the provisions of real estate license laws, ꦬonly a broker can act as an ꦍagent to list, sell, or rent anꦺother person's real estate. In most states, listing agreements must be written.

Because the same considerations arise in almost all real estate transactions, most listing agreements require similar information, starting with a description of the property. The description typically includes a list of personal property that will be left with the property when it's sold, as well as a list of personal property the seller expects to remove (for example, appliances, and window treatments).

The listing agreement also specifies the listing price, broker's duties, seller's duties, broker's compensation, terms for mediation, an automatic termination date, and any additional terms and conditions.

Types of Listing Agreements

Open Listing

With an open listing, a seller retains the right to emp♕loy any number of brokers as agents. It’s a nonexclusive type of listing, and the seller is obligated to pay a commission only to the broker who successfully finds a ready, willing, and able buyer. The seller retains the right t๊o sell the property independently without any obligation to pay a commission.

Exclusive Agency Listing

With an exclusive agency listing, one broker is authorized to act as the exclusive agent for the seller. The se♉ller retains the right to sell the property without obligation to the broker. However, the seller is obligated to pay a commission to the broker if the broker is🃏 the procuring cause of the sale.

Exclusive Right-to-Sell Listing

An exclusive right-to-sell listing is the most commonly used contract. With this type of listing agreement, one broker is appointed the sole seller's agent and has exclusive authorization to represent the property. The broker receives a commission no matter who sells the property while the listing agreement is in effect.