On behalf of Quinn Ross of The Ross Firm Professional Corporation posted in Residential Real Estate on Tuesday, February 21, 2017.
Sometimes it happens - two joint owners can't agree on the same agent to sell their property. One way to handle the dispute is to engage the services of two brokerages for a single transaction. It's known in the business as co-brokerage or co-listing.
Why Owners Go Co-Broke
Divorce is probably the most typical scenario giving rise to the need for using two brokerages. Business partners going separate ways is another. One owner could simply want to help a struggling agent who's a friend or relative. Co-brokerage can even happen when a sole property owner wants to leverage the differing expertise and marketing strategies of two agents.
How Co-Listing Works
When separate brokerages work to sell a single property, the two sales agents divide the work. One might be responsible for registering the online listing while the other arranges for showings or an open house.
Since the commission is also divvied up, the situation can easily become complicated. Conflicts can arise if one side feels the other is not shouldering a fair share of the work. The doubling of efforts may also translate into a higher total commission than using a single brokerage.
The Co-Brokerage Agreement - Details Count
Before working with two separate brokerages on the same transaction, joint owners need to pay attention to the fine print in the co-brokerage agreement. Seeking advice from two separate real estate lawyers would be prudent.
The agreement should clearly outline how the two agents will divide their services, with details describing who is responsible for what. It should also state the total commission and the agreed split between the two brokerages. Any tweaks or changes made verbally should be also set out in writing.
Selling a home? Divorcing?
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
