The landmark day of August 17, 2024 has passed and the real estate industry continues to move forward despite the changes in business practices mandated by the industry. national association of realtors (NAR) Commission Litigation Settlement Agreement Now Available Nationwide.
In Greater Boston, Linda O’Koniewski is Frontier real estatedescribed the first few days of the change in business practices as “eventful.” But while Okoniewski and her agent have spent months preparing for the changes, she said the date doesn’t come without trepidation.
“I’m not going to tell you there’s no anxiety,” Okoniewski said. “When Friday came to an end, we were all waiting to see if this was going to be a big deal, and it turned out not to be. Not that individual agents might get into trouble or get into trouble, but I haven’t seen or heard anything about it yet. to any horror stories or anything scary.
According to real estate professionals, the biggest adjustments they will make this week are getting buyers to sign buyer representation agreements and explaining to sellers that while they do not have to compensate buyers’ agents, they will likely see most potential Buyers looking for some help paying their agents.
“The biggest difference is that sellers need to have the new format and commission structure fully and carefully explained to them,” said Rachael Dotson, a Rhode Island-based agent. residential property Ltd. “Many are interested in the potential savings that the new commission structure will bring. Nonetheless, none of them want to jeopardize their sales by discouraging buyers who may have to abandon the agent or be unable to pay commissions to the agent out of pocket.
“Most sellers see the value in ensuring the deal closes and are willing to discuss participating in a buyer’s agent fee.”
On the buyer’s side, agents said they were pleased buyer representation agreements were now mandatory.
“I do like that we now have to have a buyer’s representation agreement to show all the homes. If we were showing homes without a home, we could be in a lot of trouble,” Dallas-Fort Worth agent Mandy Nichols (Mandy Nichols) said. Brixstone Real Estate. “In the past, some people would go through an agent to show them a house and then have someone else go through the process and buy the house for them, which was terrible.
“I know a lot of agents are hurt. It’s nice to know that when you show them a property, they have to use you to purchase the home, and unless you get them to sign, you’re just showing the property and not representing them.
But for some agents, getting buyers to sign these agreements isn’t always smooth sailing.
“Bringing out these agreements is becoming the line that separates the good agents from the not-so-good agents. It really levels the playing field,” said sales manager Jason Posnick. Lamacchia Real Estate.
Over the weekend, Bosnik said one of his firm’s agents met with a buyer who had previously met with an agent from another firm and was unhappy with the agent’s requirement that they sign a buyer’s representation agreement. The Lamacchia Realty agent was finally able to meet with the buyer after submitting two different agreements, a showing agreement and a more formal buyer representation agreement, which allowed the consumer to see they had options and explain why they were being Ask to sign an agreement.
In addition to dealing with consumers, agents must also deal with other agents, some of whom may not be as well prepared as others.
“One of my brokers called me on Friday and talked about how we were preparing ourselves so that they felt like the changes weren’t a big deal, but this might be a little bit of a hiccup,” said the Portland, Ore.-based broker “We’re at a disadvantage in the short term because the rest of our market doesn’t seem to know what they’re doing,” said home analyst Brad Twiss. neighborhood real estate.
Another issue is that not all agents, brokerages, or sellers handle offers of buyer’s agent compensation the same way. While some companies—including Exp PropertiesLamacchia Properties and Next home page – does not offer partnership compensation on their listings, but other agents like Lindsay Pettinelli still plan to offer partnership compensation with the seller’s consent.
“The fact that the MLS does not allow us to disclose buyer’s agent compensation does not appear to be beneficial to buyers,” said Pettinelli, an agent in Providence, Rhode Island. Churchill and Banksy. “Many buyers don’t have the funds to pay an agent’s commission as well as down payment and closing costs out of pocket; they rely on the list price, including compensation for their agents.
“If buyer agent compensation is not offered as part of the home’s list price, I think it’s valuable for buyers to know that up front. Why don’t we disclose this information in the MLS? How does that protect buyers?
Pettinelli is using contracts with sellers that outline the total commission she will charge and how much she will pay another agent to attract qualified buyers to the sale. She also noted that she will be advertising the partnership compensation on her social media channels as well as on her agency website.
While Okoniewski acknowledged that some agents may take a similar route to Pettinelli, she told her agents to treat seller concessions as “totally irrelevant.”
“It doesn’t matter,” Okoniewski said. “If a buyer’s agent signs a buyer’s agreement for a certain amount, then that’s what they need to get. If the seller is generous, they can’t make more, so I don’t know why they would even ask what the seller is offering. I think that’s the case at the moment A missing piece of the puzzle for many agents.
Complicating matters for Okoniewski and her agent is the Mulinsen passwordone of the multiple listing services her company uses, is still showing offers for buyer’s agent compensation on the MLS because it has not chosen to accept NAR’s settlement.
“It caused a lot of consternation, and I admit our agents were a little frustrated that we weren’t doing this, but I feel like by having compensation paid out in the MLS, it’s like kryptonite for agents and agencies, right?” Now. It puts a target on your back, but I think there are some large brokerages here that are choosing to live dangerously,” Okoniewski said.
Twiss attributes broker and brokerage concerns about the MLS’s removal of buyer’s agent compensation offers to concerns that sellers will no longer be willing to help with buyer’s agent compensation once removed from the MLS.
“I don’t think that’s the case,” Tewes said. “Our agents have been in discussions with sellers and it is expected that buyers will seek help with agent fees, which I don’t think is a big deal.”
Dotson also said that nationwide in Rhode Island, sellers so far appear to be receptive to offers seeking help with buyer’s agent fees.
“These changes are still very new, and most sellers seem willing to participate to some extent because they understand the importance of buyers getting guidance and representation to get to the closing table,” Dotson said.
While agents may be divided on how to respond to changes in business practices, they all agree on the fact that it’s too early to tell how their businesses and markets will be affected.
“Just like TRID, it’s going to take a while to see how it’s going to impact the market, and for a few months, it’s just going to be chaos,” said Brian Huskey, associate broker in Montana. express. Times American Real Estate.
“We’re just answering a lot of questions from consumers who saw it in the news this weekend and from agents who have gone through a lot of training but are still figuring out how to respond to these changes on the fly. It’s the Wild West again.
