What is the most common way to create an agency relationship between a home seller and a broker?

The most common way to create an agency relationship between a home seller and a broker is through a listing agreement. A listing agreement is a formal written contract in which the seller engages the services of a broker to represent them in the sale of their property. This agreement outlines the responsibilities and obligations of both parties, including how the broker will market the property, the commission structure, and the duration of the relationship.

By establishing a listing agreement, the seller grants the broker the authority to act on their behalf, which is a fundamental component of agency relationships in real estate. This written agreement provides clear terms and legal grounding, ensuring that both parties understand their rights and responsibilities, which helps avoid disputes later on.

Other options, while they may represent various forms of agency relationships, do not typically involve the formalized engagement that a listing agreement provides. For example, a buyer broker agreement pertains to representing buyers rather than sellers. Agency by implication arises from the actions or conduct of the parties rather than explicit agreement, which may not offer the same level of clarity and security as a written contract. An oral contract may be legally binding in some situations but is generally less reliable and harder to enforce compared to a written agreement.