The impacts of contract type on broker performance

This paper offers a theoretical and empirical analysis of the exclusive age ncy and exclusive-right-to-sell contracts used in real estate brokerage. Th e theoretical model predicts that while both contract types will yield the same price, the exclusive agency contract will result in faster sales than the exclusive-right-to-sell contract. In the empirical model, we find that houses sold faster under the exclusive agency contract than the exclusive-r ight-to-sell contract. However, houses sold with exclusive agency contracts also sold at a marginally lower price. We also find a slightly greater con cession from the listing price at the negotiation stage of exclusive agency listings.