The real estate industry is buzzing with news about upcoming changes in how commissions are paid, promising potential benefits for both sellers and buyers. However, amidst the excitement, there’s also a cloud of uncertainty, as the specifics of these changes remain unclear.
Here’s what you need to know:
For Sellers:
- Changes in Commission Presentation: Sellers won’t be able to publish the commission they’re willing to offer to buyers’ agents in their listings. However, they can still offer commissions, just not publicly. (Commissions will no longer be available on the MLS)
- Consider Offering Commissions: While it may seem tempting to forego offering commissions to buyers’ agents, doing so could limit the exposure of your property and potentially affect the offers you receive. Buyers Agents work hard helping buyers find homes and keep contracts together through closing. They deserve compensation. The question is, from whom?
- Potential Price Adjustments: If selling to a buyer without representation, be prepared for negotiations around reducing the price, as buyers may expect a discount due to the absence of a buyer’s agent commission. There’s a reason why most buyers and sellers are represented by Agents. The complexities of a real estate transaction require guidance from someone with knowledge and experience in the industry.
- Risk of Dual Agency: With fewer buyers represented by agents, there’s an increased risk of dual agency situations, potentially leading to conflicts of interest and legal complications. Remember, if you’re unrepresented, a Listing Agent always represents the Seller and won’t have your best interest in mind, regardless of what they tell you!
For Buyers:
- Choosing Buyer’s Agents: Buyers will need to sign agreements with buyer’s agents, ensuring representation and clarifying expectations. This protects both buyer and agents by setting expectations from the start.
- Realistic Expectations: While buyers may anticipate savings due to reduced commissions, sellers might not necessarily lower their prices accordingly. Sellers and their agents are trying to make as much money as they can on the sale of the house. Don’t count on any discounts.
- Complexity of DIY Approach: Going without a buyer’s agent means taking on tasks such as market analysis, negotiation, and paperwork, which can be challenging and time-consuming. While some of this info is publicly available, interpreting it and using it to make important decisions is really difficult and nuanced. Don’t forget the legal ramifications as well.
Key Takeaways:
- Proceed with Caution: While changes in commission structures may seem enticing, nobody really knows how this will end up. The actual settlement hasn’t been approved and won’t be until July at the earliest. Any conjecture on how this will change things moving forward is just that, a guess!
- Consult with Local Agents: Seek guidance from local real estate agents who can provide insights and advice tailored to your specific situation.
- Stay Informed: Keep abreast of developments in the real estate landscape and be prepared to adapt your approach accordingly. As we stated above, who knows how this will all play out. Be careful of the clickbait out there. The doom and gloom is mainly a tactic to get your attention and is riddled with misinformation.
In conclusion, while changes in real estate commission structures may offer promise, it’s essential to approach them thoughtfully and with expert guidance. Understanding these implications is key to making informed decisions in today’s evolving market. If you’re seeking assistance in navigating these changes, turn to Mr. Lister. Our unique brokerage utilizes technology to simplify the listing and selling process, offering tailored options from full-service to fully automated self-service. Whether you’re selling or buying, Mr. Lister ensures you’re equipped to confidently navigate the evolving landscape of real estate commissions and make informed decisions at every turn.