An exclusive listing gives a real estate agent the exclusive right to manage a property sale, with a set period of usually three months. The agent receives a commission for the sale, regardless of who finds the buyer. Agency-only listings are less common, and the seller can choose to continue with the same agent or take their business elsewhere once the exclusive listing expires. Sellers should read the terms carefully and consider hiring a real estate attorney to review the contract.
An exclusive listing is a type of real estate listing where a specific real estate agent or broker has the exclusive right to manage the sale. When people want to list homes for sale, they are often encouraged to opt for an exclusive listing because this type of listing provides an incentive for a realtor to heavily promote a property in exchange for the commission. Typically, these listings expire after a set period, usually three months.
With an exclusive right to sell the listing, the realtor or real estate agent receives a commission for the sale, no matter how it goes down. Ideally, he or she will be directly involved in the sale, but if the seller finds a buyer independently of the agency or a buyer’s agent approaches the seller, the seller’s agent will still receive a commission. Most agents prefer this because it allows them more control and provides a great incentive to sell the property as they earn a commission.
Agency-only listings, on the other hand, allow the seller to work with a buyer independently without paying a commission to the seller’s agent. This type of exclusive listing tends to be less common as the real estate agent has less control. Furthermore, the agent has less incentive to promote the property and sell it, as he cannot always access a commission.
Once an exclusive listing expires, the seller can choose to continue with the same agent or choose to take their business elsewhere. Sellers should think about this when selecting an agent to list, as many agents specialize in specific types of properties and one property does not fit all agents. A commercial property, for example, should not be listed with an agent who tends to focus on single-family homes, while a unique property such as a luxury property would be best served by a real estate agent who has a proven track record with such properties.
When signing a contract to list properties for sale, sellers should ensure they read the terms very carefully. The terms must specifically specify whether or not the listing is exclusive and the details of the exclusive listing. In addition, a clear expiration date for the listing should be provided, along with information on the sales agent’s commission. Sellers may consider hiring a real estate attorney to review a contract to confirm it is in their best interest.
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