An open listing agreement is a non-exclusive legal contract formed between the owner of a property and one (1) or more agents. Unlike other types of listings, the owner can sign the agreement with as many agents as they want. The seller can also attempt to sell the property on their own (and thus avoid having to pay a commission).
This type of “no holds barred” listing is commonly used by homeowners who 1) want to sell their property on their own (FSBO), 2) believe their home will sell relatively quickly, or 3) are looking to save money on the commission they would have to pay. While open listings may look desirable to sellers, they are the least preferable option for agents due to the uncertainty of receiving a commission.
Pros & Cons for Sellers
(PRO) – Can result in a faster-selling property if the market conditions are right.
(PRO) – Owner pays a reduced commission (or no commission if they sell on their own).
(PRO) – Not limited to working with only one (1) agent
(CON) – Owner will need to market the property themselves.
(CON) – Due to the lack of desirability for agents, they may not put in as much effort to market and sell the property.