Exclusive right to sell
Exclusive right to sell a written listing agreement appointing a broker the exclusive agent for the sale of property for a specified period of time. The listing broker is entitled to a commission if the property is sold by the owner, by the broker or by anyone else. The phrase "right to sell" really means the right to find a buyer; it does not mean that the agent has a power of attorney from the owner to sell the property. Unless the contract clearly states it is an exclusive right or authorization to sell, most courts will treat it as being a mere exclusive-agency listing[1].
As with the exclusive right to sell listing, the listing broker may allow other brokers to negotiate him or her. Thus, if any broker finds a buyer, the listing broker is entitled to a fee that will be shared with the selling broker. A seller should be made aware that with this type of listing the broker may not be able to justify the same level of advertising and promotion because the seller still may secure his or her own buyer[2].
Exclusive right to sell listings
An exclusive right to sell listing is also referred to as an exclusive authorization and right to sell or just a plain, old exclusive. The exclusive is the most widely used form of listing contract in the United States. It's popular with sellers and brokers because it provides the following[3]:
- Maximum incentive for brokers Under this form of exclusive listing, the listing broker gets paid if anyone-even the owner-finds a ready, willing, and able buyer for the property during the life of the contract. Owner and broker are allies, not adversaries, with a mutually beneficial goal of getting the listed property sold as quickly as possible for as much money as possible.
- Maximum effort for seller An exclusive right to sell listing gives your listing broker a strong monetary incentive to focus his or her time, energy, and advertising dollars on one priority- as fast, top-dollar sale of your house. To that end, listing broker should immediately cooperate with any and all other brokers who may have buyers for your property by offering to split the compensation 50/50 with the broker who generates a ready, willing, and able buyer.
- Listings are intended to be legal contracts Real estate agents hate the word contract because it scares people and puts them on guard. They prefer to call contracts agreements because agreements sound less threatening. Whatever your listing is called, the intent is to create a legally binding contract between you and the listing broker.
- Exclusive listing must have a definite termination date Note the paragraph 1 of the form provides a "listening period" commencing on a specific date and expiring at 11:59 p.m. on an equally specific date.
Types of listing agreements
The circumstances under which a seller is required to pay a broker's commission also depend on the type of listing agreement they have. The three basis types of listing agreements in current use are[4]:
- the open listing- seller is obligated to pay the broker a commission only if the broker was the procuring cause of the sale.
- the exclusive agency listing- seller agrees to list with only one broker, but retains the right to sell the property him or herself without being obligated to pay the broker a commission.
- exclusive right to sell listing- seller agrees to list with only one broker, and that broker is entitled to a commission if the property sells during the listing term, regardless of who finds the buyer.
Footnotes
| Exclusive right to sell — recommended articles |
| Fixed term tenancy — Vesting order — Tenancy at Will — Hold over tenant — Mutual Will — Conditional contract — Mortgage deed — Confession Of Judgment — Conditional sale agreement |
References
- Haupt K.J., Rockwell D.L., (2010), Principles of California Real Estate, Rockwell Publishing, Bellevue.
- Hill A.C., Kent D.L., (2004), Massachusetts Real Estate: Practice and Law, Dearborn Real Estate, Chicago.
- Peeples D.K., Peeples M., (2010), Texas Real Estate Agency, Dearborn Real Estate, Chicago.
- Sager L., (2011), Wisconsin Real Estate: Practice & Law, Dearborn Real Estate, Chicago.
Author: Natalia Hajduk
