The Evolving Real Estate Landscape

Last week, I provided an opening explanation of The National Association of REALTORS® (NAR) settlement and the industry changes taking effect this month. Since then, I've received numerous questions from readers and clients, and I'll do my best to address the most frequently asked ones now:

Do buyers have to sign a broker agreement to look at properties?

• Yes. Brokers are now required to have a signed Buyer Representation Agreement in place before showing any properties to a customer or client. This agreement may outline the broker's responsibilities, the range of services they will provide, and the buyer’s home search criteria, but it must clearly define the compensation the buyer agrees to pay for the broker's services.

What are my options if I can’t afford to pay my buyer broker?

• Buyers have three options to compensate their broker,

  1.) Pay them directly

  2.) Request the seller pay the buyer’s broker

  3.) Request a concession at closing from the seller

Will the seller's commission rate be reduced?

• Possibly. Many sellers will continue offering the same commission rate to a buyer’s broker as before the settlement. Alternatively, some sellers may choose not to provide an upfront commission, instead opting to review the buyer broker commission and any concession requests within each purchase offer before deciding which to accept. The second approach, partly used as a negotiation strategy, could result in commission savings.

How will this settlement affect home prices?

• Home values are not directly affected by commission rates. Home prices are primarily determined by market factors such as supply and demand, location, and the overall economy.

What should I look for when choosing a real estate agent now?

• Who you work with is crucial, especially now. When selecting an agent, prioritize their experience, local market expertise, reputation, and proven sales record. Effective communication and trust are vital, so choose someone who is responsive and understands your needs. Strong negotiation skills are essential to securing the best deal.

How can I stay updated on changes from the settlement?

• Continue following The Ragetté Report — we have you covered!