What is a 'listing agreement'?

A listing agreement is fundamentally a legal contract between a property owner and a real estate broker that grants the broker the authority to represent the owner's property for sale. This type of agreement outlines the terms under which the broker will help the owner sell the property, including details such as the listing price, the duration of the agreement, commission rates, and any specific duties the broker will perform.

This contract establishes a professional relationship where the broker acts on behalf of the owner to market and sell the property, utilizing their expertise, resources, and market knowledge to achieve the best possible outcome for the owner. The listing agreement is crucial because it provides clarity and protection for both parties involved, ensuring that the broker is compensated for their services as agreed and that the owner retains control over their property while leveraging the broker's skills.

In contrast, a lease agreement deals with rental terms rather than selling property, a verbal agreement lacks the formal structure and enforceability of a written contract, and a document stating property taxes due does not relate to the sale or representation of a property. Each of these alternatives highlights different aspects of real estate transactions but does not encompass the essence of what a listing agreement represents.