Real Estate Principles Ninth Edition Real Estate An

Real Estate Principles Ninth Edition Real Estate: An Introduction to the Profession Ninth Edition By Charles J. Jacobus South-Western Publishing© 2002

Chapter 20 ____________________ The Principal-Broker Relationship: Employment South-Western Publishing© 2002

Listing Agreement • An employment contract between the owner/seller and the real estate broker. South-Western Publishing© 2002

Listing Contract Types 1. Exclusive right to sell 2. Exclusive agency 3. Open listing 4. Net listing South-Western Publishing© 2002

Exclusive Right to Sell • The listing broker is entitled to a commission no matter who sells the property during the listing period. • This is the most common type of listing. South-Western Publishing© 2002

Exclusive agency • Similar to the exclusive right to sell except the owner may sell the property himself during the listing period and not owe a fee to the broker. • Broker may be less enthusiastic under this form of listing. South-Western Publishing© 2002

Open listing • There are no exclusive rights. • Whoever sells the property will earn the fee. • Brokers are reluctant to develop a sales effort. South-Western Publishing© 2002

Net listing • Owner states the price he wants for the property and agrees to pay the broker anything above this amount as commission. South-Western Publishing© 2002

Buyer Representation • Exclusive Authority to Purchase – an agreement where the broker works for the client, the buyer! • Primary responsibility is to the purchaser. • Principal is now the Buyer. • Buyer Agency! South-Western Publishing© 2002

MLS • A service among Realtor® members to offer compensation to other member brokers and increasing the market exposure for the listed property. South-Western Publishing© 2002

Broker Compensation • Commission earned when agreed between owner and broker. • Usually occurs when a “ready, willing and able buyer” is produced. • Procuring cause is the one whose efforts originated the procurement of the sale. South-Western Publishing© 2002

Key Terms • Advance fee listing • Broker • Exclusive authority to purchase • Exclusive right to sell • Multiple listing service (MLS) • Net listing • Ready, willing, and able buyer • Real estate listing South-Western Publishing© 2002