What Is a Net Listing When Selling a Home?

Why should you avoid net listings?

While the concept of a net listing might seem appealing in certain situations, it comes with significant risks for you as the seller. Here’s why it’s best to steer clear of this arrangement:

• Conflicts of interest: Because the agent’s earnings are tied to the difference between your net price and the final sale price, their priorities might be very different than yours.
• Reduced buyer exposure: Net listings can’t be posted on the MLS, limiting the visibility of your property and potentially reducing the number of interested buyers.
• Unpredictable costs: You could end up paying far more in agent fees than you would with a standard commission structure, especially if your home sells for a much higher price than expected.
• Lack of professional standards: Since net listings are banned by organizations like the NAR and are illegal in most states, their use raises concerns about the professionalism and ethics of any agent who suggests this option.

Examples of more common listing agreements

As you can see, net listings can create more problems than they solve, making them a poor choice for most home sellers. Instead of a net listing, consider these more widely used and reliable listing agreements:

• Open listing: An open listing allows you to work with multiple agents to sell your home. Only the agent who brings the buyer earns the commission. While this agreement offers flexibility, it doesn’t guarantee that any agent will prioritize selling your property.
• Exclusive agency listing: With this agreement, you work with one agent, but you retain the right to sell the home yourself without paying a commission. This option is a middle ground between flexibility and professional representation, though it may still lead to conflicts if the agent feels their efforts aren’t rewarded.
• Exclusive right to sell listing: This is the most common type of agreement, where you grant one agent exclusive rights to market and sell your home. The agent earns a commission regardless of who finds the buyer. This arrangement incentivizes the agent to focus on securing the best deal for your property.

It’s important to choose the right type of listing agreement, but it’s equally important to choose the right real estate agent. In most cases, working with a trusted agent under an exclusive right to sell agreement is often the best way to achieve a successful home sale.

A top agent will prioritize your interests, offer expert advice, and use proven marketing strategies to get you the best price for your home.

How to find a top listing agent

To find a top-performing Realtor you can trust, start by researching agents with a solid track record in your area. Look for experience, positive reviews, and a deep understanding of your local market.

You’ll also want an agent with a high sale-to-list ratio, a metric (shown as a percentage) that compares the final sale price of a property to its original list price.

One of the best ways to connect with top-performing agents is through HomeLight’s free Agent Match platform. This tool analyzes over 27 million transactions and thousands of reviews to match you with qualified agents based on your unique needs.

Bottom line: Hire a trusted listing agent

Net listings may promise simplicity, but their risks far outweigh the benefits. From legal concerns to conflicts of interest, this type of agreement often creates more challenges than solutions.

Instead, focus on finding a trusted listing agent who will act in your best interests and guide you through a transparent, professional process.

Take the first step toward a better selling experience by using HomeLight’s Agent Match platform. Answer a few simple questions to get started today. With HomeLight, you can feel confident you have the right agent by your side and avoid the pitfalls of risky agreements like net listings.

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