The NAR Settlement Could Change Real Estate
It’s been an interesting few weeks for us realtors to wrap our heads around how the NAR settlement will shake out. In a nutshell: a buyer’s agent commission can no longer be advertised in the MLS (Multiple Listing Service). In the past, the seller would agree to pay a percentage of the sale to the listing agent. The listing agent would then give part of that percentage to the agent who brought a buyer.
Does this mean the buyer’s agents are going away? I hope not – not just for my sake, but for buyers as well! Here are a few thoughts from my perspective as an agent, and especially an agent who works with a lot of buyers.
What Does a Buyer’s Agent Do?
Despite what you may read in the media, a buyer’s agent performs a lot of necessary work as part of the transaction. Besides just “opening doors”, a good agent shepherds a buyer through the offer process, contract, market conditions, negotiations, sequence of the transaction, title, inspections, mortgages, timing, appraisal, and moving, and is there when the going gets tough. And it does get tough more often than not. If you purchased a house in the last few years, you know what I’m talking about. Here’s a complete list of what an agent does from Forbes.
A Buyer’s Agent Plays a Big Role
This ruling won’t stop buyers from needing buyer agents. It will change how we get paid. The seller may still pay the buyer’s agent. The buyer may pay his or her agent. Or there may be a combination of these things based on the transaction. A real estate deal has moving pieces, and the buyer’s agent commission is one of those pieces. The bottom line is that it’s all negotiable for buyers and sellers.
Buyer’s Agreements Will Become Necessary
Of course, I want to make a commission, but I will show a house to a buyer even if the seller isn’t willing to pay me. I will have an agreement with my buyer before we see houses that specifies how my commission will be paid. Again, it’s all negotiable.
Prices Will Still Be High, Regardless of the Intention of the Ruling
I don’t think this settlement significantly impacts the price of homes. We still have a low inventory. It’s a simple case of supply and demand – too few houses, too many buyers. Demand accelerated the prices. This settlement cannot change market forces.
Some Information is Misleading
The media’s analysis of the ramifications of this settlement is frequently off base. I’ve seen some flat-out wrong headlines. I love what I do, I find a lot of joy in helping a buyer find a home to make their own and moving them through the process to closing day. I will do everything in my power to keep working with buyers!
