Friday, August 7, 2009

Terms of an exclusive listing agreement

When you put your home on the market for sale,you can have an exclusive listing agreement with a realtor for any time frame which you mutually agree to. I believe that a 6 month listing agreement is fair. My practice is to look at the average days on market for homes that have sold in or around the neighborhood,in or around the price range where my listing would be. If it has taken more than 6 months to sell other homes in the neighborhood,then I would ask for a longer listing period. I also look at how competitively priced the person's home is and if it shows well or not. If the home isn't priced above market,I also think it is fair for a real estate agent to ask for a longer listing. If the seller is adament about a certain time period for the listing--let's say the seller says he/she will only sign for 60 days and either extend or not extend when the time is up,then the listing agent has to decide whether it is a good business decision and expense to take on a short term agreement. That decision comes down to first and foremost whether he/she thinks the home will get sold or under contract in that time. Secondly,if he or she doesn't believe the home will sell that quickly,then he or she would have to consider whether having the listing agreement would be good exposure and generate more business leads,if the house he/she lists doesn't sell. He or she also has to consider how much money to invest in the listing if it were what he or she considered to be a short term.The listing agreement has a place to write down where the agreement begins and ends. You can always use a listing addendum to extend the listing. Most listing agreements have a clause stating that with X days (you and agent fill in)of written notice,you can terminate the listing agreement.

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