Minnesota State Real Estate Practice Test

What is a necessary component of a valid listing agreement?

1. Description of the real property involved

2. Broker's office address

3. Broker's license number

4. Previous sale price of the property

The correct answer is: Description of the real property involved

A valid listing agreement must include a description of the real property involved, which serves to clearly identify the specific property that is the subject of the agreement. This description typically includes details such as the property's address, legal description, and any distinguishing features that separate it from other properties. Including this information is essential for legal clarity and helps to avoid any potential disputes regarding which property the agreement pertains to. The description is fundamental to establishing the parameters of the listing, ensuring that both the seller and the broker understand exactly what property is being listed for sale. While a broker's office address, license number, and information about previous sale prices may be relevant in various contexts, they are not necessary components of the listing agreement itself. The core requirement is the identification of the property to be sold, making the description the most critical element of the agreement.