Is a Net Listing a Bilateral Contract

A net listing is a type of real estate listing agreement where the seller agrees to a net price they want to receive from the sale of their property. Any amount over the agreed-upon net price goes to the real estate agent as their commission. But is a net listing considered a bilateral contract?

The answer is not straightforward. A bilateral contract is a legal agreement between two parties where both parties agree to perform certain actions or obligations. In a net listing, the seller agrees to sell their property for a specific net price, while the agent agrees to help sell the property for any amount over that net price. Therefore, it could be argued that a net listing is a bilateral contract since both parties have agreed to specific terms and obligations.

However, there are several legal issues surrounding net listings that make it a controversial topic in the real estate industry. First, many states have banned or heavily regulated net listings due to the potential for conflicts of interest and unethical behavior. In a net listing, the agent has a financial incentive to sell the property for as much as possible. This can lead to the agent pressuring the seller to accept a lower net price or withholding offers to try to increase their commission.

Secondly, net listings can be difficult to enforce legally since they often lack the specificity and detail of other real estate listing agreements. This can lead to disputes over the agreed-upon net price and the agent`s commission.

In conclusion, while a net listing can technically be considered a bilateral contract, its legal and ethical implications make it a contentious issue in the real estate industry. As a copy editor, it is important to be aware of the potential issues surrounding net listings and to accurately reflect these concerns in any content related to real estate transactions.