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In an open listing situation, the agents are too eager to get you the buyer in the shortest time possible. They are worried that if they acted too slowly, other agents who are working on the property will sell the property and they will end up getting nothing. As such, they must not only work fast, they must also make sure that the buyer will call them if they were to advertise. The only way to guarantee that the buyer call through them is to advertise at a lower price then other agents. You can see for yourself in this diagram. Buyers who are looking at property will always ask around before they decide to view the property. If they realized that the property is an open listing, they will ask any agent who can get them a lower price to serve them. No agent in an open listing situation will ask for a higher price than what the owner is asking for. The reason is simple; they will lose all potential buyers to other agents.
Furthermore, most open listing agents will only try to market the property in the first couple of weeks. If the property is sold, they move on to other property. However, if they are not able to sell the property in the first few weeks and knowing that there are also too many agents competing for the property, they will also move on to other property and you cannot hold them responsible at all!
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On the other hand, if you have an exclusive agent, your price is only advertised by the exclusive agent. Other agents who have potential buyers in hand will have to work on their buyers in order to close the deal with the exclusive agent. As such, your price is protected and at the same time, you can also have many agents working on the property. On top of that, in an exclusive situation, the exclusive agent can boldly ask for a better price as he knows that there will not be other agents who will quote lower. An exclusive agent is also committed to continue his marketing until the property is sold. If the exclusive agent is not working on the property, you can definitely hold him responsible and the company will probably send a replacement agent for you.
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In conclusion, in an exclusive listing, you can be certain that your interest is taken care of by the agent. His commitment to you is not only to sell the property, but to make sure that your interest is taken care of. |