As your local real estate advisor, I would be remiss if I didn’t take the opportunity to share some facts and fictions about the recent case.
Fiction
Sellers are now prohibited from offering buyer’s agent compensation.
Fact
Offering a buyer’s agent commission has always been up to the seller. Sellers can continue to offer compensation to buyer’s agents if they believe it will lead to the best outcome for the sale of their property. Keeping that end goal in mind, and working towards it is essential.
Fiction
The 6% commission on buying or selling a home is gone.
Fact
As the saying goes… “everything’s negotiable.” Commissions have always been, and will continue to be negotiable in real estate transactions. Listing agents and sellers can continue to offer compensation. What may change as a result of the case is that a cooperating broker commission (the commission paid to a buyer’s agent) will not be listed within NARs affiliated MLS (multiple-listing service). It has yet to be determined where this information will be shared instead, or if it will only be discussed agent-to-agent prior to showing a home.
Fiction
Buyers can no longer have a buyer’s agent.
Fact
The proposed settlement would require that every buyer represented by a NAR-affiliated agent sign a Buyer Representation Agreement outlining the relationship between the buyer and broker before touring a property. This requirement has already been in place in Pennsylvania since the ‘90’s, so there’s not too much change for us. The difference may be when it’s signed – prior to touring any homes vs. prior to submitting an offer.
Fiction
Buyers no longer need a buyer’s agent.
Fact
When making one of the most significant financial transactions of their lifetime, buyers deserve a trusted, well-trained advisor to guide them through the process and represent their interests. Buyers are best protected by professional real estate agents who have a fiduciary responsibility to them. My experience has been that transactions flow more smoothly when there is professional representation on each side, creating open lines of communication which benefit all parties involved.
Fiction
The settlement will change the way Americans buy and sell homes.
Fact
Ok, this may be true. If approved, the terms of this settlement will undoubtedly impact certain facets of the residential real estate industry. The hope is that any changes will provide an opportunity to enhance the professionalism of the industry across the country and elevate Realtors® to the standards we at Compass have always held ourselves to. I see these updates as being positive both for my clients and for the brokerage community, as they provide additional transparency and clarity and will encourage the most professional agents to thrive.
About this very “click-bait-ish” title, and if home prices will go up or down . . . pricing changes in the housing market will be determined more by the rate of inflation, the interest rates established by the FED, and the supply and demand of the volume of properties on the market vs the volume of buyers on the market, than they will be determined by a single court case.
As a Compass agent, I always strive to provide tremendous value to my clients. As a result, I will continue to encourage a transparent commission conversation that reflects the time, effort, expertise and support I invest in each transaction.
My last bit of advice for buyers searching online . . . be cautious of (accidentally) signing a Buyers Agency Agreement with an aggregator website if you have never even talked to an agent.
If you have any questions as additional details surface, please don’t hesitate to reach out. I would be happy to talk through those with you. You can reach me at: Devon.Rowland@compass.com.
Looking for more real estate tips and local Middletown/Media events? Follow me on Instagram: @devon_rowland_realtor
