Types Of Listing Contracts Or Estate Agencies

Types of Listing Contracts or Estate Agencies

A listing contract or estate agency appointment is an agreement between the vendor or seller (hereinafter refers to the principal) and a licensed real estate agent that authorizes the real estate agent to represent the principal in the process of selling property. There are several different types of listing contracts, but very few of them are used. The most common one used is normally the Exclusive Agency with exclusive right to sell. But there are a lot more types and here are some of them being allowed all in accordance to Malaysian Estate Agency Standards:

Exclusive Agency : this refers to the instruction from a principal to a single estate agent to act on his behalf. The principal may make introductions but will leave the closing of

the transaction to the estate agent. The principal must pay the appointed estate agent the agreed fee even if the estate agent was not the effective cause of the transaction.

Sole Agency : just as in exclusive agency, a single estate agent is engaged. The principal may wish to reserve the right to close deals himself and is not obligated to

pay the agent his fee; in addition to making introductions or an arrangement may be made for a discount in fees where the principal plays an active role.

Sole Joint Agency: : this is a variation of the Sole Agency. The estate agent works together with the principal as a team and the fee is divided on a pre-agreed formula. The

principal has the flexibility to compensate additional estate agents and at the same time maintain the advantage of having one estate agent in control.

Joint Agency : this is where more than one estate agent is appointed and only the estate agent who closes the deal gets paid. The number of agents appointed is limited

and each is aware of the appointment of the others.

Ad Hoc/Open Listing : in this case, the principal can engage an unlimited number of estate agent on adhoc basis and fees are paid only on successful conclusion of the estate

agency transaction.

Apart from the types of listing contracts as mentioned above, there are also co-agency or co-broking between estate agents. This where the appointed estate agent enlists the services of another estate agent or agents and share the agency fees accordingly. Remember, a listing contract is the first legal step in the process of buying and selling properties in Malaysia.