What defines a net listing?

A net listing is a property listing in which the seller specifies a minimum amount of money they wish to receive from the sale of their property. Any amount over this specified figure becomes the broker's commission. However, net listings are often considered problematic and are generally not recognized as an official type of listing agreement in many regions, including Florida.

This is significant in understanding the nature of listing agreements and how they operate in real estate. Since net listings do not follow the standard procedure of setting a commission percentage based on the sale price, they fall outside the conventional definitions of listing types, such as exclusive right to sell or exclusive agency listings. Real estate professional organizations and many state laws discourage net listings due to the potential for conflicts of interest and unethical practices.

This context provides clarity on why net listings are viewed as technically not fitting within the established categories of listing agreements.