CHANGES IN REAL ESTATE

I’VE HEARD THE NEWS. WHAT’S CHANGING IN THE REAL ESTATE BUSINESS?

There are a lot of changes going on in the real estate business, but by working with us you’re ahead of the curve.  

Indeed, the residential real estate industry is undergoing change.  In October 2023, a Missouri court ruled in a class action case against several of America’s largest real estate companies and the National Association of Realtors (NAR).  They alleged that industry participants conspired to keep real estate commissions high, violating antitrust law.  While other litigation is ongoing, most of the real estate companies and NAR settled with the Missouri plaintiffs, paying billions.  Understand that unlike nearly all large real estate companies, RealtyPeople is NOT a defendant in ANY such lawsuits.

As part of the settlement, NAR agreed that buyer-broker commissions would no longer be offered through local Multiple Listing Services (MLSs), as had been the practice up to this point.  Instead, buyers will be required to enter into buyer-broker agreements with their agents, specifying what compensation will be paid to them.  Additionally, when an offer is made, any requested seller payments of buyer-broker commissions would be included in the offer and considered as part of the offer terms.

There is some concern in the industry that with no buyer-broker commissions offered through the MLS,  buyers will have to pay commissions to their real estate agents going forward, requiring cash that most buyers may not have.  We disagree.  We believe that in most cases, the buyer-broker commission will be incorporated into the offer paperwork, and that paperwork will specify that the commission will be paid by the seller.

There is speculation that with the changes, more buyers may choose to represent themselves.  We believe that this is a mistake for buyers.  Most sellers will have representation through their listing agents, and unrepresented buyers will be at a disadvantage.  They will not know the dynamics of the market, the required disclosures, the pitfalls in purchasing properties, and how to really negotiate in a real estate context.

Enter RealtyPeople.  We charge a modest $500 plus 1% of the purchase price when representing either buyers or sellers.  For buyers, we can provide the expertise and representation you need while not adding unnecessary costs into the transaction.  As a buyer working with RealtyPeople, you’d only be asking the seller to pay a 1% buyer-broker commission — not the 2.5-3.5% that is common in the industry.  With lower seller-paid costs, your offer will be more attractive to sellers and you can potentially get more home for your money.