What is the primary distinction between a listing agreement and a purchase agreement?

The primary distinction between a listing agreement and a purchase agreement lies in the nature of the parties involved and the purpose of each agreement. A listing agreement is a contract between a seller of a property and a real estate agent. Here, the seller engages the agent to represent them in selling their property, granting the agent the authority to market the property, negotiate offers, and facilitate the transaction. This agreement outlines terms such as the commission structure, duration of the listing, and the agent's responsibilities.

In contrast, a purchase agreement is a contract between a buyer and a seller (or their representatives) that outlines the terms of the sale of a property. The buyer expresses their intention to purchase the property, and it typically includes details like the purchase price, financing arrangements, and contingency clauses.

This understanding clarifies the distinct roles played by both agreements in real estate transactions. While the listing agreement is focused on the selling process, the purchase agreement solidifies the actual sale between the buyer and the seller.