Overview
This lecture covers the concepts, types, and legal requirements of listing agreements (brokerage engagements) in Georgia real estate, including the rules for their creation, operation, and termination.
Listing Agreements: Definition and Key Elements
- A listing agreement is a contract between a broker and a property owner to sell or lease real estate.
- Also known as commission, brokerage, or brokerage engagement agreements.
- Agreements specify list price/rental rate, legal property description, personal property included, and broker commission.
- Establishes an agent-principal relationship between broker and owner.
Types of Listing Agreements
- Open listings allow multiple brokers; only the broker who finds a buyer gets the commission.
- Exclusive listings give one broker exclusive rights; must include a specific termination date in Georgia.
- Two exclusive subtypes: Exclusive Agency (owner may sell without commission owed) and Exclusive Right to Sell (broker gets commission no matter who sells).
- Net listing agreements, illegal in Georgia, give brokers any amount over a set sale price.
Multiple Listing Services (MLS)
- MLS enables member brokers to cooperate and share property listings for wider exposure to buyers.
- Both listing and selling brokers share the commission when a sale is completed via the MLS.
- Georgia brokers commonly use exclusive right to sell agreements in MLS.
Termination of Listing Agreements
- Agreements end when the expiration date arrives, the broker closes a deal, or due to mutual/unilateral cancellation.
- Owners can unilaterally terminate but may owe commissions or costs.
- Agreements also terminate if property is destroyed or the broker dies, ceases business, or loses license (for sole proprietors).
- Corporations/partnerships retain agreements unless they dissolve.
Key Terms & Definitions
- Listing Agreement — Contract employing a broker to sell or lease property for an owner.
- Open Listing — Non-exclusive agreement; commission only to procuring broker.
- Exclusive Listing — Only one broker represents the owner; must include a set end date.
- Exclusive Agency Listing — Broker gets paid only if another agent finds the buyer.
- Exclusive Right to Sell Listing — Broker receives commission regardless of who finds the buyer.
- Net Listing — Illegal in Georgia; broker keeps all above owner's set price.
- Multiple Listing Service (MLS) — Broker network sharing property listings and commissions.
- Personalty — Personal property included in a real estate sale.
Action Items / Next Steps
- Review the different types of listing agreements and their requirements in Georgia.
- Learn the legal reasons and processes for terminating listing agreements.
- Study the rules and benefits of participating in a Multiple Listing Service.