Ridgecrest Ca Homes Clint Freeman broker/owner– The National Association of Realtors (NAR) recently settled a lawsuit with a payment of $418M. The settlement is now under review with the U.S. Department of Justice.(DOJ) Major news networks such as the New York Times, CNN, and CBS report that this settlement will mean that housing prices are set to drop significantly across the nation and that sellers will no longer be forced to pay a 6% commission to realtors to sell their homes.
Let’s set the record straight. Sellers were never forced to pay a commission of 6%. Commission rates have always been negotiable. NAR or local realtor associations don’t set realtor commissions. The listing agent discusses and negotiates them with the seller at the beginning of a listing period, and is outlined in a listing contract.
What will now change, however, is that commission compensation will no longer be stated in the local Multiple Listing Service (MLS) starting in July. No longer will it be noted that a seller will automatically offer a certain percentage of compensation to a buyer’s agent. Items of the lawsuit are still under discussion, but what could take place is that sellers could offer a total concession package to buyers.
For instance, in the future, a seller might state up front in the MLS if they are willing and how much they are willing to offer for buyers’ closing costs and repairs to the home. These concessions include buyer agent compensation. Seller concessions to a buyer might be a viable option as they will allow sellers and buyers to know upfront what to expect when selling and purchasing a home.
Also, buyers should expect more discussions about how your buyer realtor will be paid. In the past, sellers paid your agent’s commission, and your agent could view that compensation in the MLS. No longer the case come July. Expect your buyer realtor to present you with a Buyer Broker Compensation Agreement form that spells out how he or she is to be paid. If a seller is not offering concessions as explained above to cover the total expenses of what your realtor charges, you may be required to pay your realtor directly the difference for his or her services.
Again, realtor commissions have always been a negotiable aspect of real estate sales, but the settlement of NAR’s lawsuit requires realtors to discuss more about how they are to be paid. What is certain is that more forms will be filled out so that realtor commissions can be verified.
Stay tuned; more will come soon as the DOJ reviews the case. What is certain is that a new era is upon us in how buyers, sellers, and realtors alike transact real estate. Will it ultimately affect all real estate prices going forward? That is left for the future to hold.
Clint Freeman is the broker/owner of RidgecrestCaHomes. A top-reviewed realtor with 20 years of local experience.More at www.RidgecrestCaHomes.com.
