What is the basis of a net listing agreement?

The basis of a net listing agreement is that the seller specifies a price for the property. In this type of agreement, the seller indicates the minimum amount they are willing to accept for the sale of their property. The broker is then allowed to sell the property for any amount above this specified price. The excess amount, after deducting the specified net price, serves as the broker's commission.

This structure incentivizes the broker to sell the property at the highest possible price since their earnings depend on the difference between the selling price and the net amount the seller requires. It aligns the broker's motivation with the seller's financial goals while establishing a clear baseline for the transaction.

Understanding this arrangement is crucial, as it defines the broker's role and the financial interests of both parties during the sale process.