What Is a Listing Broker?
A listing broker or listing agent is a real estate professional who assists a homeowner with listing and marketing their home for sale. Some of the duties of a listing broker include determining an appropriate price for the home, establishing a listing, and holding open houses for prospective buyers. They also work with the buyer’s agent—also referred to, oddly enough, as the selling agent—to coordinate the sale of the home.
- In a real estate transaction, the listing broker or listing agent represents the seller of the property.
- The listing broker or agent’s primary role is to facilitate the sale of the home for the property owner, which can include establishing a sale price, marketing the home, and working with the buyer’s agent to finalize the purchase.
- Listing brokers earn a commission for their services, which is typically paid by the seller of the home from the proceeds of the sale.
- Homeowners don’t necessarily need to have a listing broker or agent to sell their home, but it may make the process easier.
Listing Broker Explained
To understand listing brokers, it’s helpful to first review the difference between a real estate agent and a real estate broker. An agent is someone who is licensed by their state to help people buy and sell different types of property. A real estate broker is an agent who has received an additional broker’s license. In general, brokers have more in-depth knowledge of the real estate market and the various financial and legal processes involved in selling and buying properties.
A listing broker is someone who assists property owners with the listing, marketing, and selling of their property. This can be a residential property, such as a primary residence or vacation home, but listing brokers can also work with commercial property owners. Listing brokers help the seller with a variety of tasks, including:
- Staging the property for sale
- Hiring someone to photograph the home
- Determining an appropriate sale price for the property
- Establishing a listing for the home through a multiple listing service (MLS)
- Scheduling and holding open houses
- Negotiating offers with the buyer’s agent
Once a property is listed, the listing broker is responsible for fielding offers from buyers. The broker can work with the seller to vet offers and determine whether to accept, make a counteroffer, or reject based on the offered price or other factors, such as whether they’re pre-approved for a mortgage.
Sellers are not required to use a listing broker; they can list their home as for sale by owner (FSBO) if they feel confident in their ability to navigate the sale process alone.
Listing Broker vs. Selling Agent
Just as the seller in a real estate transaction may be represented by a broker, so may the buyer. Eighty-seven percent of people who bought a home in 2021 did so with the help of a real estate agent, according to the National Association of Realtors.
The buyer’s agent is also referred to as the selling agent once an offer has been accepted and a property is under contract. In terms of what a buyer’s agent or selling agent does, the list includes:
- Helping buyers to identify properties that may fit their needs and budget
- Contacting the listing agent to schedule a showing
- Drafting an offer and forwarding it to the seller’s agent
- Walking the buyer through the remaining steps of the home-buying process once an offer is accepted
The selling agent can also communicate with the listing broker if issues arise during the home-buying process. For example, if the home inspection reveals one or more structural issues, the buyer’s agent can reach out to the seller’s agent to discuss whether the seller will make any necessary repairs themselves or offer a concession for them.
Listing Broker vs. Selling Agent
The listing broker works on behalf of the seller in a real estate transaction.
The listing broker is responsible for listing and marketing the home, scheduling showings, and negotiating with the selling agent.
The seller pays the listing broker’s commission.
The selling agent works on behalf of the buyer in a real estate transaction.
The selling agent is responsible for helping the buyer identify properties that fit their needs and budget as well as making an offer and navigating the purchase.
The seller pays the selling agent’s commission.
When selling a home, it’s important to research listing brokers beforehand to understand what services they offer, how knowledgeable they are about the real estate market in your area, and how they’re paid.
Listing Broker Compensation
Listing brokers and listing agents are paid a fee for their services in assisting a seller, though they’re typically paid only if the sale is completed. Traditionally, a typical commission associated with the sale of a home is around 6% of the home’s sale price. This commission is split equally between the listing broker or agent and the buyer’s or selling agent.
Real estate commissions are usually paid by the seller of the home out of the proceeds of the sale. For example, say you owe $200,000 on your home. Your listing agent is able to sell it for $400,000, resulting in a $200,000 profit to you. If you assume a 6% commission rate, then you would need to pay $24,000 in commissions ($400,000 × 0.06). Of that amount, $12,000 would go to the listing broker or listing agent and $12,000 would go to the buyer’s agent. Your net profit would be $176,000 ($200,000 - $24,000).
There are some situations, however, in which a listing broker might be able to collect both commissions. Specifically, they can do so if they’re acting as a dual agent. A dual agent in real estate represents both the buyer and the seller of the property. Dual agency is not allowed in all states, and when it is permitted, the agent must adhere to a fiduciary duty when acting on behalf of the buyer and the seller.
It may be possible to negotiate a lower commission rate with a listing broker or agent if the home has a higher listing price and seems likely to sell quickly with minimal marketing or negotiation required.
How is a listing broker different from a selling agent?
The listing broker works on behalf of the seller in a real estate transaction, while the selling agent works on behalf of the buyer.
What is a typical listing broker’s fee?
Listing brokers and listing agents are typically paid only if the sale is completed. Traditionally, a typical commission associated with the sale of a home is around 6% of the home’s sale price. This commission is split equally between the listing broker or agent and the buyer’s or selling agent.
Are listing brokers required for a home sale?
Homeowners don’t necessarily need to have a listing broker or agent to sell their home, but it may make the process easier.
The Bottom Line
A listing broker can make selling a home easier, though hiring one isn’t a necessity for property owners who are comfortable selling on their own. When working with a listing broker or agent, consider their track record, reputation, and overall expertise. It also can be helpful to ask questions about how often they’ll communicate with you during the process of selling your home and how they prefer to communicate. This can give you an idea of what to expect during the time that you’ll be working with them to sell your home.
Finally, you can review the best real estate websites to see how much homes like yours are selling for in your area when deciding how much to list your property for.