What is a 'listing agreement' and what does it create?

A LISTING AGREEMENT is a bilateral contract between a property owner (principal) and a real estate broker (agent). It: authorises the broker to market and sell the property; defines the agency relationship (broker represents the seller as their fiduciary); specifies the compensation (commission percentage or flat fee); sets the listing period; and describes the property and listing price. Types: EXCLUSIVE RIGHT TO SELL (most common — broker earns commission regardless of who finds the buyer); EXCLUSIVE AGENCY (broker earns commission unless the owner finds the buyer themselves); OPEN LISTING (non-exclusive — seller can list with multiple brokers, pays only the one who finds the buyer). The listing agreement establishes the broker's authority to act on the seller's behalf.