open listing is a non-exclusive authorization for brokers to find
a buyer for your property. You can give as many brokers as you wish
an open listing on your house. You're obligated to pay a commission
to the first broker who fulfills either of the following conditions:
Finds a buyer ready, willing, and able to enter into a contract
that meets the exact terms of your listing.
the buyer whose offer you ultimately accept. If you find the buyer
by yourself, you don't have to pay any of the brokers. And you
can cancel an open listing any time you want without penalty.
If this arrangement sounds wonderful, think again. Smart sellers
won't give brokers an open listing and good brokers won't accept
them. Here's why:
Limited advertising and marketing of your property: In
many places, depending on the local rules, brokers can't put open
listings into the multiple listing service (MLS). This restriction
is a big disadvantage. The MLS is a highly effective tool brokers
use to internally advertise listings to other MLS members who
may have buyers for their listings. Nor do brokers produce fancy
brochures or put big classified ads in the newspaper to tell the
world about an open listing.
only advertise or market open listings as a last resort: They
disdainfully refer to open listings as pocket listings because
brokers tuck them away "in their pocket" passively waiting
for a buyer to come along.
control: If you give 10 brokers an open listing on your house,
you'll end up doing work that a listing agent normally handles.
All the agents will call you to coordinate showings of your property.
You must prepare the house for showings. You also have to debrief
agents after showings to find out if you're getting an offer and,
if not, find out why not. If you like chaos, you'll like an open
broker is your competitor: Because you don't have to pay any
broker if you sell the house yourself, brokers see you as a competitor.
This adversarial relationship encourages brokers to work for buyers,
An open listing is barely better than no listing at all. Unless
you have an extremely compelling reason that you absolutely, positively
must list your house with a bevy of brokers, you'll be better served
with an exclusive listing.
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