What is a brokerage agreement?

A brokerage agreement is fundamentally a contract that outlines the relationship between an agent and a client. This document serves to delineate the duties, responsibilities, and expectations of both parties within a real estate transaction. It establishes the scope of services the agent will provide, such as market analysis, property showings, and negotiation on behalf of the client. Additionally, the agreement specifies the terms of compensation and other critical details necessary for facilitating a smooth transaction.

In the context of real estate, these agreements are essential for defining the obligations of the parties involved, as well as protecting the legal rights of each party. It facilitates a clear understanding of what the client can expect from the agent, and vice versa, which is integral for building a trustworthy professional relationship.

The other options, while related to the real estate industry, do not accurately reflect the definition of a brokerage agreement. For example, an agreement between brokers would not encompass the agent-client dynamic, and a lease agreement for office space refers to the renting of physical property rather than a real estate service contract. Lastly, a commission-sharing agreement pertains to how agents distribute earnings among themselves, rather than detailing a specific client-agent relationship.