The real estate brokerage industry is undergoing changes as of August 17, 2024, driven by a proposed settlement between the National Association of REALTORS® (NAR) and class action parties. At Gibson Sotheby’s International Realty, our agents are well-prepared and equipped with updated client agreements and clear disclosures to protect and empower our clients.
Our agents have been educating sellers and buyers about their new options, outlining benefits and potential risks — especially concerning the 12 MLSs that have not opted into the settlement terms.
Here’s a summary of key changes and their impacts:
1. Buyer representation agreements: Buyer agents who are REALTORS® must now have a representation agreement with their clients before showing homes. This agreement outlines the relationship, services, and fees.
- Impact on sellers: Sellers may see buyer agent fees included in offers, allowing them to be financeable as before.
- Impact on buyers: Buyers gain better opportunities to negotiate and understand agent fees. Existing clients without agreements must now sign a new one.
2. Buyer agent compensation: Most MLSs will no longer publish buyer agent compensation. While sellers were never required to offer compensation, some MLSs had set a minimum offer.
- Impact on sellers: Sellers may choose not to offer compensation, but buyers are likely to include the agent fee in offers, making it financeable.
- Impact on buyers: Buyer agents will need to research whether compensation is offered. We recommend buyers write the agent fee into their offers, regardless of what’s offered.
3. MLS exceptions in Massachusetts: MLSpin and LINK will continue publishing buyer agent compensation offers, which now come directly from the seller.
- Impact on sellers: This option may increase legal risks and liability for compensation disputes, affecting both sellers and their agents.
- Impact on buyers: Even with published offers, compensation may still be negotiated down or removed during negotiations.
Some seller agents may encourage offering compensation, but this can weaken the seller’s bargaining position and introduce legal risks.
What remains the same: Buying or selling a home is still a significant and complex process, often tied to major life events. Our agents remain committed to providing the expertise and guidance that make a difference in every transaction.
I welcome any questions you may have about these changes. For guidance with buying or selling in any market, connect with me via email [email protected] or on social media.
