Listing Contracts: Long or Short?

398 days ago via SpringbokRealty    Discuss    Travel
Putting your house on the market is a big deal. Whether you’ve been thinking about it for quite some time or even if you made a quick decision to sell, you’ll want the process to run smoothly and not drag out forever. After all, who doesn’t wish their house would sell in just a few days? 

Luckily, for some individuals, that sometimes happens. For others, it takes much longer. So, when you’ve found the perfect realtor, and you’re ready to sign that listing contract, how many months should you give that agent to sell your house? 

What’s Average? 

Most agents are encouraged by their brokers to propose a 6-month listing to their seller. This is the national average and one that seems to work for most people. 

You may find that if you have a newer agent – one that hasn’t had a lot of experience with listings yet – he or she is willing to take a shorter listing just to get some inventory on the books, so to speak. However, that’s not always a wise idea, especially for a new agent. It often takes them some time to get their proverbial ducks in a row and to get your listing out there to the buying public. On the flip side, they’re likely to be quite enthusiastic about selling your home so they’ll work extra hard.  

What Determines the Best Listing Length? 

Of course, whether you list for a short time or a long time depends on a lot more than just the experience of your agent.  

Market conditions can have a huge impact on how long you choose to list your home with a particular agent. For example, if it’s a seller’s market – one where there is less inventory than there are buyers – you might choose a listing shorter than six months. To determine whether or not that’s a good option, take a look at recent listings in your area to see how long it took them to sell. If many are disappearing within just a few short weeks or less than a 3-month listing might be ample. If you’ve complied with your realtor’s requests for making your house buyer-ready and it’s still not sold within that three months – especially if similar properties around you are selling quickly – then the option to find a new realtor may be a good one.  

If you’re in a buyer’s market, it may take longer than six months to sell your home. A buyers’ market – one where there are way more listed homes than there are buyers – can be tough for your agent, no matter how hard they work on selling your listing. It’s just the nature of the market. So, if you’re satisfied that they’ve done everything possible to sell your house, if your personalities mesh, and if you’re happy with all other terms of the agreement, by all means, start with a 6-month contract and then renew it for another 3 or 6 months. If it’s not sold at that point, you can consider another realtor OR consider the fact that it might just be the wrong time to sell.  

Be Reasonable 

From time to time, we’ve heard sellers ask for very short listing periods, perhaps just a month or two. After all, they say, what can a realtor do in 6 months that they can’t do in six weeks? 

The answer is “a lot”  

Such a short amount of time doesn’t really give the agent a chance to market the house properly, even in a good market and especially in a down market. Even in this world of high-tech marketing, it takes time to put together good photographs, video, marketing copy, and everything else you deserve when you list your home. It’s reasonable to expect that all this will take at least a few weeks.  

Remember, your agent will be spending THEIR money to make your listing attractive to prospective buyers, so he or she at least deserves enough time to do a good job for you before you’re ready to pull the plug on the listing.  

Exiting Before Your Listing Expires 

Speaking of pulling the plug, many sellers are eager to know what happens if they sign a 6-month (or longer) agreement and their agent simply isn’t doing his or her job as far as marketing their home is concerned.  

Indeed, this is a question you should ask before you sign a contract with any realtor, even one you deem to be ideal for your needs. Ask if there’s a clause that allows you to exit after a given amount of time and, if not, suggest you include one.  

Most realtors want to maintain a good reputation in their community, so if you’re unhappy, they will likely allow you to exit the contract. However, they may insist on some sort of protection clause which states that, after they release you from the contract, you may not sell your home to a buyer they brought to the table without paying them a commission. It’s a fair clause and should be part of any contract, even one that continues throughout the originally agreed-upon time span.  

You Can Help, Too 

Remember, a listing contract – whether long or short – demands your cooperation, too. In order for your home to sell, you must keep it in a sale-able condition, must be willing to alter your schedule to accommodate buyer appointments when necessary, and should be ready to allow your realtor to do all it takes to be successful, including scheduling open houses.  

If you and your agent work together, regardless of market conditions, your house will likely sell in a timely manner.  

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