Changes In Real Estate After The NAR Lawsuit

Posted By Carrie Higgs @ Sep 8th 2024 9:45pm In: Real Estate News 2024

Hello,

What a great summer it’s been here in the Ozarks, and we’ve been busy as a bee lately. As you may know, there’s been a lot of “buzz” going on in the real estate world out there, and I wanted to bring you up to speed on the latest news!

First off, there are new changes as a result of the NAR lawsuit that just went into effect last week. It’s important for buyers and sellers to have a clear understanding of how Realtors are moving forward with these changes. The main changes that are now taking place are that offers of compensation are no longer listed on the MLS, and a buyer must sign a buyer’s agency agreement before they can view a home.

Let me attempt to explain this :)

There are some common misunderstandings with these changes, such as the belief that sellers will no longer offer any buyer’s agent compensation or that buyers have to be locked into a buyer’s agency contract. Both of these statements are not true!

However, as Realtors, whether we are working with a buyer or a seller, one of the most significant changes is the increased transparency around our fees. We now need to provide clearer, more detailed disclosures about how compensation is split between buyer and seller agents. This change aims to give consumers a better understanding of what they are paying for and who is responsible for the costs. These fees are negotiable between the buyer and seller on who pays the buyer’s agent.

Sellers, keep in mind that this fee is decided when you sign a listing contract, and a listing agent may choose not to list the property if you’re not in agreement. Also, when a buyer’s agent writes the offer on your home, they can request that the seller pay their compensation.

For buyers, when the buyer’s agency agreement is signed, the buyer agent compensation will be written into this form, which could be 2%, 3%, 4%, etc. The form also states that the buyer’s agent will make an effort to have the seller agree to pay this amount, and if the sellers offer of compensation is lower than the amount written on the buyer's agency form, then it’s the responsibility of the buyer to pay the difference. So, buyers, please keep in mind that these fees, just like lender fees or title fees, are balanced out between the buyer and seller on your final HUD statement at closing.

Most likely, sellers will still offer compensation to buyer’s agents, but it’s important that your Realtor explains the different scenarios that could affect your bottom line. If the buyer has to pay their agent the full compensation, the offer they make to the seller will likely be lower, making it the same difference to the seller on the closing statement. It’s all a negotiation!

Lastly, for buyers who are afraid of being locked into an agreement, ask the agent if they will make it short-term and then extend it for a longer period if needed.

Please don’t hesitate to call me with your real estate needs or if you have any questions! 417-230-3957