An exclusive right-to-sell listing agreement (listing agreement) establishes the obligations of the broker and seller in an employment relationship. Under this listing arrangement, which is the most common among broker agreements, the seller designates the broker as the only agent with the exclusive right to sell the property. A defining element of the agreement is that the seller must pay a commission to the broker in all cases, regardless of who ultimately sells the property.
Listing price. The seller, with the advice of the broker, sets the listing price for the property. Typically, the broker contributes his experience and knowledge of market conditions to help establish a reasonable price. The seller may also contact an independent appraiser to ascertain the market value of the property. This allows the seller to accurately estimate how much money he can earn from the sale by assigning a market value and deducting expenses such as liens, the broker’s commission and closing costs.
Listing period. The listing agreement is required to clearly establish a date on which the listing will terminate. The parties should agree on a period of time during which the broker is employed by the seller. If no expiry date is listed in the agreement, but the agreement establishes the total number of days that an agreement is to be in effect, then the day on which the listing begins is regarded as the first day of the engagement. To renew the agreement following the conclusion of the listing period, the terms of the renewal should be included in a new agreement or an addendum to the original listing argument.
Commission provision. The broker and seller must include a provision specifying the amount to be paid as a commission to the broker. If the broker proposes an unreasonable rate, the seller is free to negotiate a more favorable rate. Brokers are prohibited from engaging in price fixing to set commission rates among brokers. This is a violation of federal antitrust laws and may result in civil and criminal prosecution.
Permission to advertise. Georgia law also requires that the seller provides written permission to advertise his property for sale. The broker must obtain consent in writing from the seller to post “For Sale” signs on the property.
The experienced team of attorneys at the Law Offices of Mark Weinstein, P.C. can help you litigate your real estate claims. Contact Mark Weinstein and his colleagues at (770) 888-7707 or visit them at http://www.markweinsteinlaw.com to find out how they can advise you.