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Home › Sell Property › Exclusive Listing Agreement – What Is It? [Pros & Cons]
One of the many decisions homeowners face when deciding to sell is how to list their property. Most sellers choose to sign an exclusive listing agreement with one real estate agent, while others prefer to sign an open or exclusive agency listing agreement.
There are pros and cons for each, so it is important to choose the agreement that most suits your individual circumstances. We explain the difference between the three, so you can make the best choice for you.
Key Takeaways Understand the Agreement Type. An exclusive listing (exclusive right‑to‑sell) gives one agent the sole right to market and sell your property meaning the agent earns commission even if you find the buyer. Make sure this model suits your circumstances before signing. Negotiate a Short, Performance‑Based Term. Aim for a 60–90 day exclusive period with a written break or performance clause (e.g., ability to cancel if no acceptable offers are received). This keeps the agent motivated and gives you flexibility to switch strategies if needed. Clarify Costs and Escape Clauses Up‑Front. Insist on a detailed marketing budget (with refunds for unused funds), define any buyer exclusions (friends/family), and limit hold‑over clauses. Getting these points in writing protects you from unexpected fees and commission disputes later on.
Key Takeaways
An exclusive listing agreement (otherwise referred to as an exclusive right-to-sell listing agreement) gives exclusive selling rights to one real estate agent for a set period of time. Your chosen real estate agent will act on your behalf to sell the property for the best possible price.
While such an agreement is in place, sellers are not permitted to use the services of another agent. However, this type of agreement usually has an end date, after which you can decide to change agents.
If a seller decides to sign an exclusive listing agreement, the real estate gains the exclusive right to sell, which means the seller cannot sell the property themselves without paying the agent’s commission. Occasionally, an exception is written into the contract, which allows the seller to sell to family or friends within a certain time-frame where commission is waived.
For an overview on some listing agreement types, this quick video from a real estate agent in WA gives good reasons on why you might want to consider an exclusive listing agreement.
There are two other types of listing agreements: open listings and exclusive agency listings. They differ in how the property can be sold and each type has advantages and disadvantages, depending on the situation.
An open listing agreement allows the owner to retain the right to sell the property. They can have an open agreement with multiple real estate agents and will only pay commission to the agent that finds the buyer. If the seller finds the buyer themselves, they do not have to pay any commission.
In this situation, sellers will usually do a lot of the work themselves, so agent fees are often much lower than with other listing agreements. The table below shows the pros and cons of opting for an open listing agreement.
Although similar in name, an exclusive agency listing agreement is not the same as an exclusive listing agreement. They do both grant the right to sell to one real estate agent; however, with an exclusive agency listing, sellers are able to find their own buyer and avoid agency commissions. Here are some of the pros and cons of opting for an exclusive agency listing.
When opting for an exclusive agency listing agreement, be sure to choose an appropriate contract length. Often, agents will request that expired agreements are converted to exclusive right-to-sell listing agreements. This provides them with guaranteed commission, which may mean they work harder for you. However, if the property doesn’t sell under an exclusive agency listing, it is essential to determine the reason why the process was unsuccessful. If it is due to the agent’s services, it may be better to sign an exclusive right-to-sell listing agreement with another agent instead.
An exclusive listing agreement guarantees the commission to the chosen agent, and this has many advantages:
An additional benefit is that sellers are able to build an open and honest relationship with the agent, as there is no competition. Agents will be open about offers received and provide honest advice about which offers to reject. They may also offer advice on beneficial renovations or other ways that sellers could increase the value of the property. Communication is also simpler because sellers have one point of contact during the sale process.
Despite the many advantages, an exclusive listing agreement does not guarantee a quick, easy sale. The real estate agent’s services may not meet the seller’s expectations or they may struggle to find a buyer. Disadvantages include:
It is possible to choose from various contract lengths when drawing up a contract for an exclusive listing agreement. Typically, the choices include:
The seller and agent will determine this together after some discussion about the seller’s expectations and individual situation. However, it is important to remember that the final decision rests with the seller.
The following six factors will help you determine which length is right for you:
These considerations are important because, if your agreement expires while your home has a pending sale contract, it will need to be extended. This can often present challenges, so it is best to choose a listing length that suits the current market and property type right from the beginning.
A 30 day listing is usually a good option in a seller’s market. In this type of market, it may only take a few days before listed properties have sales pending. Sellers can reasonably expect to have interest in their property in a relatively short time-frame; however, a seller’s market does not guarantee that the property will sell within the 30 day listing time.
If the property doesn’t sell, sellers can opt for a different agent. However, it is vital to investigate why it didn’t sell, as it may not be a result of the agent’s efforts.
A 90 day listing is the average length of an exclusive listing agreement when the market is neither a seller’s nor a buyer’s market. This gives a reasonable amount of time to obtain a good price for the property, as initial open houses are done in the first month. When a property doesn’t sell in the first month, the agent has a further two months to find a suitable buyer.
After an unsuccessful open house, sellers or agents can speak to potential buyers to find out why it was unsuccessful. They may provide a unique insight, which can help the seller or agent determine what could be improved before the next open house. This could involve performing maintenance work, improving the presentation of the house, choosing a more suitable viewing time, lowering the sale price and many other possibilities.
Only after questioning potential buyers will sellers be able to better understand what didn’t work. Sellers will then be able to work with the agent to make improvements before the next open house.
A six month listing is the best choice in a buyer’s market. In this type of market, properties take longer to sell, with an average time of over two months. Taking this option will help to ensure the listing agreement doesn’t expire while a sale is pending and allows the process to be completed under the initial agreement.
It is possible to request a written guarantee from the agent, which states that you may cancel the agreement after 90 days if you are unhappy with the agent’s services. This is often a good idea, as six months is a long time to wait when things aren’t going as expected.
A one year listing is a good option when the property is truly unique. Houses that are very expensive or located in a rural area will likely take much longer to sell, as there are fewer potential buyers.
Real estate agents need time to market unique properties appropriately and will often not agree to sell these properties when the seller requests a shorter listing time.
Other examples of unique properties include mansions, private islands and upmarket holiday homes.
Before signing an exclusive listing agreement, it’s a good idea to interview multiple local real estate agents to determine which best suits your needs. You can instantly compare all of your local real estate agents using our simple comparison service. This is a great place to start, as you will immediately have a suitable list of agents to contact.
We recommend answering the key questions above first to ensure you have a good idea of your specific needs and some expectation of what a quality real estate agent can offer in terms of listing agreements. Once you decide on an agent, they will be able to answer any further questions you have regarding listing agreements and expected time frames for selling your property.
With an exclusive listing (a.k.a. exclusive right‑to‑sell) the agent earns commission no matter who sells the property; an exclusive agency lets you avoid commission if you introduce the buyer.
Absolutely. Commissions are not fixed by law in NSW or Victoria and must be discussed and agreed in writing before you sign.
You’ll still owe commission unless your contract lists that buyer as an exclusion (common for friends or family). Ask your agent to write the exclusion into the agreement before signing.
Each state differs. In QLD you may end an exclusive appointment after the first 60 days with 30 days written notice (max fixed term is 90 days) . In NSW you can end after 90 days of a long agreement by giving 30 days’ notice.
Only if you negotiate that up‑front. NSW rules require all advertising costs (and any rebates an agent receives) to be disclosed and agreed in the agency agreement, but refunds are by negotiation.
Yes. In most states the agreement simply lapses on the expiry date, at which point you’re free to sign with other agents or move to an open listing. QLD’s Form 6 lets you tick a box that automatically converts the appointment to an open listing once the exclusive term ends.
Often yes. When buyer demand is high many homes attract acceptable offers within two weeks; a short 30‑day term keeps the pressure on the agent while giving you flexibility to reassess if you’re unsatisfied.
