Major Changes to Real Estate Commission Rules: What You Need to Know | Tom’s Take #388

In early 2024, the National Association of Realtors reached a significant settlement impacting real estate commission practices. These changes are now being implemented, and it's crucial for both buyers and sellers to understand how they affect you.

Key Updates:
1. No More MLS Commission Offers: Offers of compensation for agents working with buyers will no longer be listed on the MLS. Sellers will still have the option to offer compensation, but it won't be visible on the MLS.
2. Pre-Tour Agreements Required: Home buyers must now sign an agreement with their agent before touring homes. This agreement can be exclusive, property-specific, or a trial period to ensure both parties are comfortable.
3. Transparency in Agent Compensation: Agents and buyers must clearly outline and agree on compensation details before moving forward. Fees remain negotiable.
4. Closing Cost Contributions: Sellers can still offer to cover some of the buyer’s closing costs and offer compensation to buyer agents as an incentive.
5. Changes for Sellers: Sellers have more control over whether to offer compensation to buyer agents, and transparency in these terms is mandatory.

What You Should Do:
* For Buyers: Understand the new requirements for agreements and compensation. Ensure your agent communicates all relevant details before you view properties.
* For Sellers: Review your options and strategies for agent compensation and how these will be communicated outside the MLS.

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[paerial]

All these real estate agents are so full of it. Now all of a sudden they're out there saying, "these commissions have ALWAYS been negotiable!" but we're they saying that one year ago? NO! It was their profit making secret. Never said a word about it. In fact when i asked an agent to negotiate their commission a few years back he literally laughed at me and said no, "find another agent".

This week i asked my agent (we're passively looking for a new home) to send me her buyer's agreement. She did, along with a lengthy email message emphasizing how "nothing's really changed" and that commissions have "ALWAYS been negotiable". She even put it in caps like that. She NEVER mentioned that 12 years ago when she helped us buy the house we're in today. Not a word. Just, "you don't have to worry about it because the sellers are paying my fees".

Such a scam.

[bromschwig]

Buyers agents don’t need to know a thing about what the sellers are offering. They should already have a buyers agreement in place saying what they will get paid. I instruct my agent (seller), …. You want help, put it in the offer.

[lawrencefeldman]

What the process to not use a buyer's agent. View the property on your own and place a offer without a buyers agent. Just deal direct with sellers agency. How is this handled.

[raz]

It wasn’t an option despite what everyone says. 5-6% take it or leave was the language. Stop spreading BS!