I hired a real estate professional to sell my home. The seller representation agreement (listing agreement) I signed is for four months. It’s only been two months, but I want to terminate the agreement, can I?
The short answer is yes, but it can be complicated.
The agreement you signed is a legal contract between you and a real estate brokerage to sell your home. It contains a start date and an end date, as well as provisions for ending the agreement early. If you and your real estate professional agree in writing to end the agreement before the end date, the agreement immediately ends.
If you change your mind about selling your home and your real estate professional agrees to end the agreement early, you may be responsible for reimbursing your real estate professional for reasonable expenses they incurred while your property was for sale. Those potential expenses need to be listed on the agreement when you sign it; your real estate professional can’t add them after the fact. These expenses may include, but aren’t limited to, reimbursement of advertising, measurement, or photography costs.
But, what happens when you want to end your agreement early and your real estate professional doesn’t agree?
If you want to end your agreement early because you want to work with a different real estate brokerage, there could be consequences. For example, if you begin working with another real estate brokerage, and your property sells, your first real estate brokerage could make a claim that commissions are payable to them since the brokerage didn’t agree to release you from the obligations of your agreement. You could find yourself owing commission to two brokerages.
Think carefully about why you want to end your agreement early. If it’s because you genuinely changed your mind about selling, perhaps your employment situation changed, be open and upfront with your real estate professional. You won’t be the first seller who has a change of heart or financial circumstances, but your real estate brokerage is under no requirement to release you from your agreement.
Another possibility is that your real estate professional may agree to a conditional termination of your agreement. Conditional terminations typically require the seller to agree in writing that they won’t re-list their property for sale with another real estate brokerage before the end of their original agreement.
If you want to end your agreement early because you and your real estate professional are not working well together or you have concerns about their performance, RECA encourages you to speak to their broker.
“Ask Charles” is a question and answer column by Charles Stevenson, Director of Professional Standards with the Real Estate Council of Alberta (RECA), www.reca.ca. RECA is the independent, non-government agency responsible for the regulation of Alberta’s real estate industry. We license, govern, and set the standards of practice for all real estate, mortgage brokerage, and real estate appraisal professionals in Alberta. To submit a question, email email@example.com.