The greatest risk associated with listings is investing a lot of time and money on selling the property only to have the listing expire, or the property not sell. Usually, when a listing doesn’t sell, it’s because the list price is too high. Not surprisingly, it’s a real slap in the face when the seller decides to re-list with another agent at a lower price, especially when the property is subsequently sold.
No question about it, the scenario above is absolutely unfair. That’s why it’s important to address the issue when you get the listing agreement signed by adding a clause that requires the seller to pay a commission if they reduce the price within 90 days of the expiration date. With the approval of your broker, consider using the following terminology:
“In the event seller lowers the listing price of the property at any time during the listing, or within 90 days of the expiration of the listing agreement, seller agrees to extend the original term of the listing agreement by 6 months to give the agent the opportunity to market the property at the lower price.”
When the listing agreement is being signed, most sellers will find this request to be very reasonable. The clause will keep your sellers honest by ensuring they give you the same opportunity to market the property at a fair price before deciding to give their listing to another agent.