What is a listing agreement?

A listing agreement is fundamentally a contract between a property owner and a real estate agent that authorizes the agent to act on behalf of the owner in the sale of the property. This contract outlines the terms of the sale, including the price, the duration of the agreement, and the commission structure. By entering into a listing agreement, the property owner is granting the agent the right to market the property, communicate with potential buyers, and facilitate the transaction. This type of agreement is crucial in the real estate process, as it ensures that both parties understand their rights and obligations, fostering a clear and professional relationship throughout the selling process.

In contrast, options like leasing a property or entering a financial agreement with a lender do not accurately describe the nature of a listing agreement, as they pertain to different aspects of real estate transactions. Similarly, detailing property taxes is unrelated to the functions and stipulations established within a listing agreement, which is focused exclusively on the sales process.