Which type of listing is banned in many states as it allows agents to keep any amount above a set net price?

Which type of listing is banned in many states as it allows agents to keep any amount above a set net price?

• A. Open Listing
• B. Exclusive Listing
• C. Net Listing
• D. Flat Fee Listing

Answer: (C)

A net listing is a type of real estate listing where the seller establishes a minimum selling price for their property, and any amount above this price is kept by the agent as commission. This method can create a conflict of interest for the agent, as they may be incentivized to prioritize their commission over the best interest of the seller, potentially urging them to accept lower offers that exceed the net price. Due to these ethical concerns and the potential for abuse, many states have prohibited net listings, recognizing that such arrangements could compromise the integrity of the transaction and the interests of the seller. Therefore, the choice of net listing correctly identifies a type of listing that is banned in numerous states because of these underlying risks. The other types of listings mentioned do not carry the same ethical concerns. For example, open listings allow multiple agents to market the property, exclusive listings grant a single agent the right to sell, and flat fee listings typically involve a set fee for various services without tying the agent's compensation directly to the sale price above a certain amount.

A net listing is a type of real estate listing where the seller establishes a minimum selling price for their property, and any amount above this price is kept by the agent as commission. This method can create a conflict of interest for the agent, as they may be incentivized to prioritize their commission over the best interest of the seller, potentially urging them to accept lower offers that exceed the net price.

Due to these ethical concerns and the potential for abuse, many states have prohibited net listings, recognizing that such arrangements could compromise the integrity of the transaction and the interests of the seller. Therefore, the choice of net listing correctly identifies a type of listing that is banned in numerous states because of these underlying risks.

The other types of listings mentioned do not carry the same ethical concerns. For example, open listings allow multiple agents to market the property, exclusive listings grant a single agent the right to sell, and flat fee listings typically involve a set fee for various services without tying the agent's compensation directly to the sale price above a certain amount.