What is the “listing agreement” in real estate?

The listing agreement is a formal contract that establishes a relationship between a property owner and a real estate broker. This agreement details the broker's rights and obligations in the process of marketing and selling the property. It outlines important elements such as the duration of the agreement, the commission structure, and the duties that the broker is expected to fulfill. By signing this contract, the property owner gives the broker the authority to act on their behalf exclusively to facilitate the sale or lease of the property.

This contractual framework is vital in real estate transactions as it protects both parties’ interests and ensures a clear understanding of expectations. The broker typically takes on responsibilities like advertising the property, conducting open houses, and negotiating offers, all while working to secure the best possible outcome for the property owner.