On which type of listing contract is a broker required to state the amount of their commission is negotiable and not fixed by law?
Question & Answer
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Multi-family residential listing agreements.
Multi-family residential listings are governed by different disclosure requirements. California law does not mandate the same negotiable commission disclosure for these properties as it does for industrial properties.
Retail commercial center listing agreements.
Retail commercial center agreements may involve complex commission structures, but California law specifically singles out single-use industrial properties for this particular disclosure requirement, not all commercial properties.
Single-use industrial property listing agreements.
One-to-four unit residential property listing agreements.
One-to-four unit residential property listings are subject to different disclosure requirements. California law does not require brokers to state that commissions are negotiable in these residential agreements.
Why is this correct?
California law specifically requires brokers to state that commissions are negotiable and not fixed by law in single-use industrial property listing agreements. This disclosure requirement ensures transparency in commercial real estate transactions where commission structures may vary significantly from residential transactions.
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