Under which condition does a broker earn a commission?

A broker earns a commission when they are the procuring cause of the sale, which means they are the agent whose efforts directly lead to the sale of a property. This principle emphasizes the role of the broker in facilitating the transaction, such as introducing the buyer to the property or negotiating the terms of the sale. The procuring cause concept is essential in real estate because it establishes that the broker's involvement and actions were instrumental in bringing about the successful outcome.

In contrast, merely presenting an oral offer does not guarantee a commission, as the offer must lead to a completed transaction. Being a principal of the listing broker does not automatically entitle someone to a commission; it requires specific contractual agreements relating to their role in the transaction. Similarly, in an open listing, multiple brokers can be involved, and only the one who successfully closes the deal earns the commission. Thus, being the procuring cause is the definitive condition that qualifies for commission entitlement.