Listing broker

Key Takeaways

• In Washington the listing broker represents the seller and is the seller's agent under the state's agency statute.
• The services agreement runs between the seller and the firm, and the firm appoints the individual broker to represent the seller (RCW 18.86.020).
• A seller's agent owes the seller loyalty, timely disclosure of conflicts, confidentiality that survives the relationship, and a good faith and continuous effort to find a buyer (RCW 18.86.040).
• The duties owed to every party in the transaction, including honesty and timely presentation of all written offers, are owed to the buyer as well and may not be waived (RCW 18.86.030).

What It Means

In Washington, the listing broker is the licensee who represents the seller. The same role is often called the listing agent, and the state's agency statute calls it the seller's agent. The listing broker prices the property with the seller, markets it, answers questions from other brokers, presents the offers that arrive, and stays with the transaction through closing.

The relationship is created by paperwork between the seller and the firm, not between the seller and one person. The firm enters a services agreement with the seller and appoints one of its brokers to represent that seller. The listing belongs to the firm, and the appointed broker carries it out.

On the other side of the same deal sits the Selling Broker, the licensee working with the buyer. Washington licenses brokers and managing brokers rather than salespersons, so both sides of the transaction are held by brokers. When both are affiliated with the same firm, the transaction raises Limited Dual Agency questions, and that arrangement works only where both principals consented in writing beforehand.

How It Works in Washington

Under RCW 18.86.020, a broker whose firm has appointed the broker to represent the seller pursuant to a services agreement between the firm and the seller is the seller's agent. That agreement has to state the term, name the appointed broker, say whether the relationship is exclusive or nonexclusive, and record any consent to limited dual agency, which the principal initials separately.

RCW 18.86.040 sets what the seller's agent owes the seller: loyalty by taking no action adverse or detrimental to the seller's interest, timely disclosure of conflicts of interest, advice to seek expert help on matters beyond the broker's expertise, confidentiality that continues after the agency relationship ends, and a good faith and continuous effort to find a buyer. Those sit on top of the Statutory Duties owed to all parties under RCW 18.86.030, which include reasonable skill and care, honesty and good faith, timely presentation of all written offers and notices, disclosure of known material facts, accounting for money received, delivery of the pamphlet prescribed by RCW 18.86.120, and written agency disclosure. Compensation runs to the firm, and RCW 18.85.301 keeps the broker's share flowing through the firm's designated broker.

Example

Dana signs a services agreement with Cascade Realty on a Tuesday, appointing Marisol as her seller's agent, and Marisol delivers the pamphlet prescribed by RCW 18.86.120 and gets Dana's acknowledgment before that signature. The home goes on the market at $549,000.

Two written offers arrive the following weekend, one at $528,000 with no contingencies and one at $540,000 subject to inspection. Marisol presents both in a timely manner, as RCW 18.86.030 requires, even though she expects Dana to prefer the higher number. She also keeps Dana informed that Cascade has a competing listing three streets away, which under RCW 18.86.040 does not in and of itself breach the duty of loyalty or create a conflict of interest.

Dana accepts the $540,000 offer. Under the services agreement Dana compensates Cascade 5 percent, which is $27,000, and she has consented to Cascade sharing half of that, $13,500, with the firm representing the buyer.

Common Mistakes and Exam Traps

• Listing broker and listing agent are the same role in Washington. The licensee working with the buyer is the selling broker, and the two get swapped constantly on exams.
• The services agreement is between the seller and the firm, and the firm appoints the broker, so the listing belongs to the firm rather than to the individual.
• Washington licenses brokers and managing brokers, not salespersons, so 'listing salesperson' is the wrong vocabulary in this state.
• Being paid by the seller does not by itself make a firm the seller's agent, because payment of compensation does not establish an agency relationship (RCW 18.86.080).