The Listing Agreement
The listing agreement is a formal, legally binding contract drawn up between you and the real estate brokerage firm handling your sale.
It should include a performance guarantee, which specifies benchmarks for your agent to meet (i.e. marketing tasks executed on schedule) and an escape clause that gives you the right to cancel early if you're not satisfied with your agent's performance.
A listing agreement generally includes these three main components:
Terms and Conditions
These are the terms and conditions under which you have engaged the real estate firm to sell your home:
- The "listing agent's" name (your real estate agent)
- The agent's responsibilities and marketing obligations
- Duration of the contract (typically three or six months; it can be any length you choose-even one day)
- Commission rate (typically 5% to 7% of the selling price)
Property Details
This is a legal description of your property, including:
- Lot and plan number and civic address
- Zoning and district details
- Taxes
- Size of lot
- Type and age of structure
- Floor area
- Number, size and description of rooms
- Asking price, minimum deposit and mortgage details, if your mortgage can be assumed by the purchaser
- Specific features, etc.
Chattel and Fixture Details
This specifies which chattels and fixtures are to be included or excluded from any sale agreement.
What is a chattel vs. a fixture?
- Chattels are items of personal property (such as major appliances) that may or may not be connected to your home by pipes or wires.
- Fixtures are items that have been permanently attached to the property in some way, have technically become part of the house, and will most likely become the buyer's property (such as built-in shelving, wall-to-wall carpeting and light fixtures).
The distinction between chattels and fixtures can be blurry. How do you classify an electric garage door opener and its remote control units, or a central vac system and its accessories?
Leave nothing to chance. Clearly spell out in the listing agreement exactly which fixtures and chattels you're including and excluding in your asking price. Although fixtures are typically included in the sale of a home, you can choose to exclude certain things. For example, even if a chandelier is considered a fixture, you can list it as an exclusion if you want to take it to your new home. A mistake in classifying chattels and fixtures can be costly.
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