Presentation on theme: "Chapter 8 Real Estate Brokerage"— Presentation transcript:
1 Chapter 8 Real Estate Brokerage The real estate sales process, agency theory, licensing, types of brokerage firms and compensation.
2 The Real Estate Process: Listing agreementsMarketing the property and qualifying the buyersPresentation and negotiationsContracts and closing
3 Real Estate Brokers and Salespersons: Licensing of salespeople and brokers:Transactions on one’s own behalfConducting transactions on behalf of othersState license requirementsReal estate brokerage regulationConsumer protection
4 Legal Aspects of the Broker-Client Relationship: Agency LawPrincipalAgentSubagent
5 The Role of Real Estate Brokers: Broker RepresentationListing BrokerSelling BrokerBuyer’s AgentDual AgentTransaction Broker
6 The Creation of Agency Relationships: Broker-Seller Relationship (Seller’s Agent)Open ListingExclusive-Agency ListingExclusive-Right-To-Sell ListingNet ListingBroker’s Right to a CommissionBroker-Buyer Relationship (Buyer’s Agent)Buyer’s RepresentationTypes of Buyer Representation AgreementsCompensating the Buyer’s Broker
7 Duties and Rights Under Agency Relationships: Broker’s Duties:Fraud and NegligenceMisrepresentationSeller’s Agent’s duties to the sellerFair Housing LawsSteeringBlockbustingBuyer’s Agent’s duties to buyersBuyer’s Agent’s duties to seller’sDisclosure of agency relationship
8 Termination of Agency Relationships: Methods of Agency Termination:Sale of the listed propertyTime limit expiresMutual agreementBreach of dutiesLoss of contractual capacityImprovements are destroyedProperty is taken by government under power of eminent domain
9 Types of Brokerage Firms: The one-office firmProperty type specializationFranchisesDesk fee arrangementsMultiple Listing Services (MLS)
10 Broker and Salesperson Compensation: Percentage CommissionsAnti-Trust ViolationsCompensation for Salespersons
11 TYPICAL COMMISSION SPLIT Sale of Property$100,000Commission6.0%$6,000Listing Broker Firm50% of Commission$3,000Selling Broker Firm50% of Commission$3,000Listing Salesperson50% of Firm’s Commission*$1,500Selling Salesperson50% of Firm’s Commission*$1,500*This percentage can vary from 50 percent to 90 percent depending on such factors as length of time the salesperson has been with the firm and whether he or she is an officer of the firm.