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Why Do Listings Expire?

When a seller signs a listing agreement with a real estate agent, they agree to terms that become part of the contract, such as giving the agent exclusive rights to sell the home and how long the contract will be in force. Because agents and their brokers bear the cost of marketing the seller’s listing, most listing contracts run between six months and as long as a year. Much depends on the market conditions in the area so that even homes that sell quickly must take time to close. In other markets wherein homes do not sell quickly, the term of the listing is likely to be longer. 

The listing agent is required to make the listing public by putting it into the multiple listing service (MLS) where the agent and agent’s broker have a membership, usually three days or up to a week after the listing contract is signed. The purpose of the MLS is to regulate cooperation among agents and brokers so they know they’ll be paid for their efforts to sell another agent’s listing. They are also designed to protect agents’ clients from solicitation from other agents. From the seller’s point of view, the MLS provides the most exposure for listings so that they’ll sell quickly. MLSs often have agreements with real estate franchises such as Berkshire Hathaway HomeServices and third-party listing sites such as Realtor.com to carry the MLS listings on their websites and to be able to share them with homebuyers and their agents. 

Sometimes putting the listing in front of as many homebuyers as possible isn’t enough to get it sold for a number of reasons. The housing market can soften, but a more likely reason is that the home wasn’t priced attractively for its age, condition and location. In that case, the listing can expire at the end of its term. 

It’s easy to do a post-mortem and determine why the listing didn’t sell, but home sellers often don’t want to face that their home doesn’t appear to offer the value that other listings do. They may have an inflated sense of their home’s value, they see the home as a nest egg for retirement, they want to buy a more expensive home or pay off debt, or they simply failed to listen to the advice of their agent as to what the home needs in order to sell. Sellers have good memories of raising children or being happy in their home and may not understand why homebuyers don’t see the home the same way. This is a primary reason why sellers refuse to update their homes. Another reason is that they simply don’t have the money to market their homes properly and are trying to sell it “as-is.” According to Realtor.com, other reasons are minimal marketing, lack of staging, or an oversupply of similar homes. 

When a listing is heading toward expiration, the seller can do several things. They can work with the listing agent to withdraw the listing so that they can complete the updates or repairs the home needs. Most agents are willing to do this because the original contract is still in place and the seller is more willing to do what’s necessary to get the home sold. Once the home is ready to be remarketed, the listing is reentered into the MLS at a new price point. If the listing is allowed to expire, the seller is released from the contract. They have the choice to relist with their agent, to find a new agent, or take the home off the market. 

Berkshire Hathaway HomeServices network professionals are trained to provide the most assistance possible to sellers to ensure that their homes will sell quickly and for the highest price possible.