Net Listing

Hey James! Thank you for reaching out to us. Regarding net listings, California is not a state in which they are illegal. Keeping that in mind, it's important to note that while net listings are legal in California, because of the risk of a breach of the agent's fiduciary obligations, net listings shouldn't be used in any situation. In California, net listings are usually only used if one is dealing with a highly sophisticated client or for clients who are represented independently. Full disclosure of any conflicts involved is required, however.

Hey, James! If you read through our glossary content, you will notice that we mentioned net listings in the state of Georgia. As far as we know, the status of net listings hasn't changed, so our content is up to date.

Hey, Jeffrey! Net listings are legal in the state of Illinois, but not recommended because there is a potential for fraud. Also if fraud occurs it is hard to make a case and take it to court. About potential restrictions when it comes to net listings, you might want to reach out to a real estate attorney or check out our article, listings 101 that talks about the different type of listings.

Hey Devin,

Net listings provide a potential conflict of interest for the broker. That’s why net listing agreements are considered in many states unprofessional and it constitutes a violation of the Michigan Occupational Code. Therefore, it is illegal in Michigan. If you want to find out more detail about listings, check out our article Listing 101: What you need to know when hiring a real estate agent or broker.

Hey, Nancy! As we have already mentioned in some comments on the same topic already net listings are illegal in most states. As we speak net listings are not allowed in Michigan but they are still legal in Florida, although they are frowned upon, and they could lead to illegal transactions.

Hello, Roberto! Yes, net listings are currently legal in the state of Nevada. The law or the regulations here do not treat net listings separately which means that real estate agents can sign a net listing agreement without breaking any law. However, you should approach this type of contract with the utmost care and make sure that your client fully understands each clause. You may also read more about listing agreements in our article LISTINGS 101: What You Need To Know When You Hire A Real Estate Agent Or A Broker. 

According to 2017 Kentucky PSI Real Estate Exam Prep Questions, Answers & Explanations book published by Real Estate Exam Professionals Ltd., officially, listings based on net price are illegal because they introduce a potential conflict of interest for the broker. They are considered unethical and are illegal in most states.

Hey Julio
thanks for reaching out!

What kind of guidelines and term are you looking for? Since it's a bilateral contract between you and the agent you can have on it whatever you want and the other party agrees to. For the most common or important safeguards on this otherwise very unsafe type of listing, we recommend you get in contact with a real estate lawyer.

Hey, Melissa

It's not exactly on what type of listing they can be used. Net Listing IS a type of listing in itself. The problem is that they are not legal in many states. In some, they are legal, but the local board of real estate agents does not recommend it. The truth is that, when it's good, it's great. But when it goes awry, it's awful and one of the parts (home seller or real estate agent) will get the bad end of the stick.

As of the time we write this comment, Florida and California are two states where Net Listings are frowned upon, but legal.  And some of them have specific guidelines that need to be followed when doing a Net Listing, otherwise, it becomes an illegal transaction. Your state of Georgia, for instance, does not allow this listing agreement.

Hope we've helped!