What is the main purpose of a listing agreement?

The main purpose of a listing agreement is to establish a relationship between the seller and the real estate agent. This agreement serves as a formal contract in which the seller authorizes the agent to act on their behalf in the sale of their property. It outlines the responsibilities of both parties, including the agent's duty to market the property, conduct showings, negotiate on the seller's behalf, and ultimately facilitate the sale. By delineating the terms of this professional relationship, the listing agreement sets expectations for both the seller and the agent, ensuring clarity and mutual understanding throughout the selling process.

Finalizing the sale of a property is a result of the activities conducted under the listing agreement, not its primary purpose. Similarly, providing a mortgage guarantee and determining property taxes relate to financing and property assessment, respectively, which are not roles defined or carried out through a listing agreement. Thus, the focus of such agreements remains on establishing and formalizing the agent-seller relationship, which is foundational to effective real estate transactions.