What Happens When a Listing Agreement Expires in NYC?

What Happens When a Listing Agreement Expires in NYC? Full blog post: https://www.hauseit.com/what-happens-listing-agreement-expires-nyc/

Save 6% When Selling in NYC: https://www.hauseit.com/agent-assisted-fsbo/

1% Full Service: https://www.hauseit.com/agent-managed-listing/

We’ll demystify this topic in the following video. I’m Nick at Hauseit. Check out our website https://hauseit.com to learn how to save money if you’re buying or selling real estate here in New York City. So let’s get started!

You’re probably watching this video because you’re in the process of selling, and the listing agreement with your current broker might expiring soon. Or maybe it already expired.

There are several options when your listing agreement expires.

The first option, is of course to renew the agreement with your existing broker. Some properties in NYC genuinely take longer to sell than the term of a typical listing agreement. In most cases, it has lot more to do with market conditions and the unique nature of your home as opposed to the competence (or incompetence) of your listing agent.

So if your agent has done a good job thus far, she or he might just legitimately need one extension in order to see it through and find a buyer.

If you renew, your listing will simply remain active. Nothing else really happens. The sale effort continues in earnest with your current broker.

If, however, you’re dissatisfied with your listing agent, you probably won’t renew. This means that your listing agent will need to completely delist your home at the time the agreement expires. Please keep in mind that it usually takes 24 to 72 hours for listings to completely disappear online and to be removed from the MLS.

Keep in mind however that the expiration of your listing agreement doesn’t necessarily signify the end of your dialogue with the listing agent. This is because most listing agreements in NYC contain ‘protected buyer’ language.

This fairly standard clause in a listing agreement allows the listing agent to submit to you a handful of names of prospective purchasers. If one of these prospective purchasers signs a contract to buy the property within a certain number of days, the listing agent is eligible for commission.

What this means, is that if you hire a new listing agent within 90 days of the expiration of your previous listing agreement, you have to tell them about the protected buyer list, and make sure that these names are excluded from commission obligations in a new listing agreement.

If you fail to do this, you could potentially be on the hook for double commission if any one of those buyers purchases your property. You’d literally have to pay 6% to the old broker, and 6% to the new broker! Talk about a nightmare.

That being said, it’s important to keep in mind that a protected buyer list is actually highly advantageous to you as a seller. After all, why would you want to remove all motivation from your old broker if she or he is in touch with a few buyers who might legitimately buy your home? Not to mention, the presence of the protected list may create competition between your old broker and new listing agent, meaning they’re both likely to work even harder to try and bring you offers as quickly as possible.

Another question you might be asking is, will my home show up as a new listing if I hire a new broker? Technically, the answer to this question depends on local MLS rules as well as the policies of online search portals where your listing appears.

For example, here in NYC, the Real Estate Board of New York mandates that a listing must be off-market for at least 90 days before being considered a new listing. However, as of this filming, StreetEasy typically just resets the day count on a property whenever a seller hires a new listing agent, even if the 90-day waiting period has not elapsed, as required by the real estate board.

Before we let you go, we want to remind you that there are other alternatives to paying 6% commission here in NYC. At Hauseit, we offer two services which will save you money compared to a traditional broker.

You can save up to 6% on broker commissions through Hauseit’s Assisted FSBO Listing Service. Learn More: https://www.hauseit.com/agent-assisted-fsbo/

We also offer a 1% Full-Service Listing for sellers who’d like to save money but prefer a more traditional approach to selling in NYC. Learn More: https://www.hauseit.com/agent-managed-listing/

Feel free to check out all of Hauseit’s New York City listings on StreetEasy: https://streeteasy.com/profile/924230-hauseit

To learn more and sign-up, visit our website, https://hauseit.com, send us an email to [email protected] or give us at a call at (888) 494-8258. We’ve saved New Yorkers millions on closing costs since we were founded in 2014, and we’d love to help you too.
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Hauseit LLC, Licensed Real Estate Broker
Tel: (888) 494-8258 | https://www.hauseit.com
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