Real Estate Principles Practice Exam

When a listing agreement is signed between a seller and a broker, a fiduciary relationship is established. This means that the broker becomes the seller's agent and is obligated to act in the best interest of the seller. This relationship requires the broker to uphold duties such as loyalty, full disclosure, confidentiality, obedience, and accounting. The broker must prioritize the seller's interests above their own and work diligently to achieve the seller's goals in the transaction.

The fiduciary duty is fundamental in real estate transactions, as it builds trust and ensures that the seller's rights and interests are protected throughout the process. This legal and ethical responsibility is a key characteristic that differentiates the broker's role from merely providing transactional support or consultancy services, which do not carry the same degree of responsibility or obligation to prioritize the client's best interests.