There are several different types of
listing contracts, but very few of
them are used. The "Exclusive Right
to Sell" is the most common, but
there is the "open listing," the
"exclusive agency listing," and the
"one-time show."
Open Listing
The "open listing" is mostly used by
people trying to sell their home by
owner who are also willing to work
with real estate agents. Basically,
it gives a real estate agent the
right to bring buyers around to view
your home. If their client buys your
home, the agent earns a commission.
There is nothing exclusive about an
open listing and a home seller can
give out such listings to every
agent who comes around.
For that reason, no agent is going
to market your home or put it in the
Multiple Listing Service. If your
home fits the criteria for one of
their clients, and it is convenient,
they may be willing to show it to
their client. That is all an "open
listing" is good for.
One-Time Show
A "one-time show" is similar to an
open listing in many respects, as it
is most often used by real estate
agents who are showing a FSBO (for
sale by owner) to one of their
clients. The home seller signs the
agreement, which identifies the
potential buyer and guarantees the
agent a commission should that buyer
purchase the home. This prevents the
buyer and seller from negotiating
directly later and trying to avoid
paying the agent’s commission.
As with an open listing, agents will
not be spending money on marketing
your home and it will not be placed
in the Multiple Listing System.
Exclusive Agency Listing
An "exclusive agency" listing allows
an agent to list and market your
home, guaranteeing them a commission
if the house sells through any real
estate agent or company. It also
allows sellers to seek out buyers on
their own.
This is not a popular type of
listing agreement. The reason is
that there is not much incentive for
agents to spend money marketing your
home. If you come up with your own
buyer, they have spent money they
cannot earn back through the real
estate commission. Plus, it is too
easy for a greedy buyer to go around
the agent and negotiate directly
with the seller.
If you find an agent willing to
accept such a listing, do not expect
too much from them. They will
probably just place it in the
Multiple Listing Service and sit
around to see if something happens.
A good agent would never accept such
a listing, and you probably want a
good agent.
Exclusive Right to Sell
Giving a real estate agent the
"exclusive right to sell" your
property does not mean that there
will not be other agents involved.
Your agent is the listing agent and
part of his or her job is to market
your home to other agents who work
with buyers. Those agents will show
your home to their clients.
Regardless of who sells the home,
even if you sell it yourself to a
friend at work, your listing agent
will earn a commission.
An exclusive right to sell is the
only type of listing an effective
real estate agent will accept. This
is because they have a reasonable
expectation of earning back any
money they spend on promoting and
marketing your property.
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