New Commission -3%

[Anonymous]

As a seller- I could easily host an open house and be around for potential buyers to see my house.

Our house would sell quick and I certainly don’t need to pay someone to show my house

[Anonymous]

So we are about to list our house and have a listing agreement (not yet signed) giving our agent 5%, split with the buyer's agent. Should I counter now with 4% in light of this NAR ruling? My inclination is to give 4% and tell her to split it however she wants.

[Anonymous]

Anonymous wrote:So we are about to list our house and have a listing agreement (not yet signed) giving our agent 5%, split with the buyer's agent. Should I counter now with 4% in light of this NAR ruling? My inclination is to give 4% and tell her to split it however she wants.

I would absolutely do this.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Woo hoo, about time!! I look for real estate listings myself and I contact listing agents myself. Why do I still need to pay someone $60,000 (3% of $1 million) for that service? I was going to do FSBO but if the commission goes down to 1% I might consider using an agent.

NAR will also no longer get exclusive access to MLS.

Just the fact that you wrote this explains how ignorant you are about the process. You will still be paying that 60k. Do you really think that sellers are going to cut their price 60 K for you? The only difference is now you will be paying that baked in commission without actually having an agent.

Also, you could have always paid one percent. The commissions are not fixed and have never been.

Well, there was enough funny business going on with commissions that there was a successful lawsuit over it that is forcing a big change in business practices — as well as a $400+ million settlement. You can’t deny the obvious.

Unfortunately, uninformed buyers don’t know what they don’t know and will forego representation for a perceived upfront savings. They will then deal with a listing agent that is required to be honest, but not fair working on behalf of their principal, the seller. After they realize they don’t get a good deal and didn’t do their due diligence, they will cry wolf and regulation will need to be added. It will be a mess and so short-sighted.

C’mon, both agents are paid by the seller under the outgoing system. Most “buyer’s” agents work for the deal, the best interests of the buyer are secondary at best. The buyer’s agent does not get paid for achieving the best outcome for the buyer; they get paid for making sure the deal closes.

[Anonymous]

Exactly. Buyers will actually come out way ahead by not having pushy overpriced agents who are actually working against them. I represented myself when I bought my house, and got the 2.5% commission as a closing cost credit (in addition to negotiating 5% off the asking price). It was a great decision. I got the form contract from the sellers agent and filled it in myself. Anyone with a high school education should be able to figure it out.

You did well. We were naive about the whole buyer's agent thing (didn't even know it was a "thing") and the seller's agent sold to us instead of many others because he got the whole 6% for himself! Basically we got the house because we had no buyer's agent! To his credit he did give us a 2K refrigerator as a "present". It's a slimy business for sure and good that there is an effort to clean it up.

[Anonymous]

So we are about to list our house and have a listing agreement (not yet signed) giving our agent 5%, split with the buyer's agent. Should I counter now with 4% in light of this NAR ruling? My inclination is to give 4% and tell her to split it however she wants.

I would give 3% and tell the agent that in light of the new ruling that your expectation is that the buyers will pay their buying agent on whatever terms they wish.

[Anonymous]

Anonymous wrote:So we are about to list our house and have a listing agreement (not yet signed) giving our agent 5%, split with the buyer's agent. Should I counter now with 4% in light of this NAR ruling? My inclination is to give 4% and tell her to split it however she wants.

If you can, I'd recommend waiting until after the new rules take effect in July. Until then, you have to put the buyers agent commission on the listing. Buyers agents may steer try to steer clients away from you until at least July. And after July, you don't have to give the buyers agent anything...so 3% or less for the sellers agent, and the buyers can pay for their own agent.

If you have to list now, then of course you gotta do what you gotta do. But you're giving away money, so if you can wait, that would be the better bet.

[Anonymous]

I wonder if the spring/early summer housing market will seize up now that sellers will know they can save money by waiting until July.

[Anonymous]

Anonymous wrote:I wonder if the spring/early summer housing market will seize up now that sellers will know they can save money by waiting until July.

The industry practices will have to change, but the settlement, if approved, won’t necessarily get rid of commission sharing. The buyer agent promised commission just cannot be promised through the MLS platform anymore. It can and likely will take place off-platform in some new shape or form.

Per the local MLS:
“ What’s changing (late this year, if the settlement is approved):

While MLS subscribers will continue to be able to offer to share their compensation with a buyer’s broker, no longer would that be allowed in the MLS (effective July 2024). Instead, those offers of compensation could still be made, albeit only through separate negotiation, as needed (like commercial brokers do today).
And a new option will be added: A seller's agent will be able to enter into the MLS whether and what their seller client is willing to offer as a concession in the price, such as “$x towards a new roof and x% towards closing costs.”
MLS subscribers WILL NOT be allowed to put a specific amount of buyer-broker compensation in the concession field. More to come on this point in the coming weeks.”

[Anonymous]

Anonymous wrote:

Anonymous wrote:I wonder if the spring/early summer housing market will seize up now that sellers will know they can save money by waiting until July.

The industry practices will have to change, but the settlement, if approved, won’t necessarily get rid of commission sharing. The buyer agent promised commission just cannot be promised through the MLS platform anymore. It can and likely will take place off-platform in some new shape or form.

Per the local MLS:
“ What’s changing (late this year, if the settlement is approved):

While MLS subscribers will continue to be able to offer to share their compensation with a buyer’s broker, no longer would that be allowed in the MLS (effective July 2024). Instead, those offers of compensation could still be made, albeit only through separate negotiation, as needed (like commercial brokers do today).
And a new option will be added: A seller's agent will be able to enter into the MLS whether and what their seller client is willing to offer as a concession in the price, such as “$x towards a new roof and x% towards closing costs.”
MLS subscribers WILL NOT be allowed to put a specific amount of buyer-broker compensation in the concession field. More to come on this point in the coming weeks.”

Yeah, but why would I as a seller want to offer anything to the buyers agent, especially in a tight-supply market like we have now? Are you saying sellers agents would refuse to work with anyone who does not commit to making an "off-MLS" deal to provide compensation to buyers agents? Seems like that would violate the settlement agreement, and will land NAR and all sellers agents who engage in the practice back in court. It's still collusion to create a floor on compensation. Since buyers agents must also as of July sign written agreements with their buyers that spells out compensation up front, anything that makes the seller responsible is going to get brokerages and agents sued again.

[Anonymous]

It will be interesting to see how lenders treat buyers commissions as closing costs. It looks like FHA and VA may disallow it meaning the buyer will need to come up with their agent’s commission in addition to closing costs.

https://www.housingwire.com/articles/agent-commission-lawsuits-cast-long-shadow-over-va-fha-borrowers/

[Anonymous]

Anonymous wrote:

Anonymous wrote:I wonder if the spring/early summer housing market will seize up now that sellers will know they can save money by waiting until July.

The industry practices will have to change, but the settlement, if approved, won’t necessarily get rid of commission sharing. The buyer agent promised commission just cannot be promised through the MLS platform anymore. It can and likely will take place off-platform in some new shape or form.

Per the local MLS:
“ What’s changing (late this year, if the settlement is approved):

While MLS subscribers will continue to be able to offer to share their compensation with a buyer’s broker, no longer would that be allowed in the MLS (effective July 2024). Instead, those offers of compensation could still be made, albeit only through separate negotiation, as needed (like commercial brokers do today).
And a new option will be added: A seller's agent will be able to enter into the MLS whether and what their seller client is willing to offer as a concession in the price, such as “$x towards a new roof and x% towards closing costs.”
MLS subscribers WILL NOT be allowed to put a specific amount of buyer-broker compensation in the concession field. More to come on this point in the coming weeks.”

If agents just end up with the same scheme we have now, just not formalized through the MLS, the NAR will be back in court. It's not that easy to circumvent antitrust law.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I wonder if the spring/early summer housing market will seize up now that sellers will know they can save money by waiting until July.

The industry practices will have to change, but the settlement, if approved, won’t necessarily get rid of commission sharing. The buyer agent promised commission just cannot be promised through the MLS platform anymore. It can and likely will take place off-platform in some new shape or form.

Per the local MLS:
“ What’s changing (late this year, if the settlement is approved):

While MLS subscribers will continue to be able to offer to share their compensation with a buyer’s broker, no longer would that be allowed in the MLS (effective July 2024). Instead, those offers of compensation could still be made, albeit only through separate negotiation, as needed (like commercial brokers do today).
And a new option will be added: A seller's agent will be able to enter into the MLS whether and what their seller client is willing to offer as a concession in the price, such as “$x towards a new roof and x% towards closing costs.”
MLS subscribers WILL NOT be allowed to put a specific amount of buyer-broker compensation in the concession field. More to come on this point in the coming weeks.”

Yeah, but why would I as a seller want to offer anything to the buyers agent, especially in a tight-supply market like we have now? Are you saying sellers agents would refuse to work with anyone who does not commit to making an "off-MLS" deal to provide compensation to buyers agents? Seems like that would violate the settlement agreement, and will land NAR and all sellers agents who engage in the practice back in court. It's still collusion to create a floor on compensation. Since buyers agents must also as of July sign written agreements with their buyers that spells out compensation up front, anything that makes the seller responsible is going to get brokerages and agents sued again.

Buyers' agents have always had to sign a contract with their clients regarding how they will be compensated. This is not new.

[Anonymous]

I'm not sure how this will play out but I think that many of you are not realizing the unintended consequences for sellers with this ruling. The market is so tight that many buyers are writing and losing many offers. Multiple offers are obviously good for sellers bc besides having buyers escalate way over asking, buyers also need to waive contingencies, offer free rent backs etc to win. What is going to happen is that buyers are going to write less. So I have new clients who I just started working with who had lost 8 houses before firing their agent to come work with me. They preinspected 8 times for a cost over $5k. If they had to pay a buyer's agent on top of that, I can guarantee you that they wouldn't have written on all of those homes. So less offers, less buyers pushing other offers to their cap, less competition-bad for sellers.

[Anonymous]

Anonymous wrote:I'm not sure how this will play out but I think that many of you are not realizing the unintended consequences for sellers with this ruling. The market is so tight that many buyers are writing and losing many offers. Multiple offers are obviously good for sellers bc besides having buyers escalate way over asking, buyers also need to waive contingencies, offer free rent backs etc to win. What is going to happen is that buyers are going to write less. So I have new clients who I just started working with who had lost 8 houses before firing their agent to come work with me. They preinspected 8 times for a cost over $5k. If they had to pay a buyer's agent on top of that, I can guarantee you that they wouldn't have written on all of those homes. So less offers, less buyers pushing other offers to their cap, less competition-bad for sellers.

This is not a problem actually. Why would anyone be concerned about what is best for sellers in this economy? The situation now where all buyers in packs compete for the same homes doesn't benefit buyers.