What's this Proposed NAR Settlement All About Anyway?

Let's eliminate some of the hype, and see what it REALLY might look like.

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Who has seen the headlines about the National Association of Realtors proposed settlement??

A lot of it seems like clickbait to me, but they certainly have captured a lot of attention!

?So, I just wanted to take a moment to quickly share the facts and clear up some of the misleading headlines for you!?

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Number 1

It is a proposal for settlement and still needs to be approved by the court. The proposed settlement amount is $418 million. And that is a lot of money - even by today's standards, but even if it’s?approved it likely won’t go into effect until later this summer.?

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Number 2

First of all, let’s talk about what ISN’T going to change or be affected by this proposed settlement.?

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Most likely,? you will still want a real estate agent to help you find a home, negotiate an offer, and?guide you through the?financial and legal aspects of that process, including working with financing, title, escrow, inspection, appraisals, and more. And as before, the agent is going to earn a commission.

What kind of commission and amount are not addressed in the settlement, and we will still do what we have always done, which is have the following discussion about commission, with the buyers!

As a seller, you will probably still ask a real estate agent to help you sell your home. We will still come to your home, do a walk-through -

and tell you what we need to do to get your home ready for the market They will still tell you how to get the best possible price in the least amount of time possible with as little inconvenience as possible. And sellers will still pay their real estate agent a commission.?

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Number 3

So this brings me to what has changed.

?The HOW:

What we do today, during the listing agreement process, is?couple the conversation about the seller's agent commission with what we need to pay the buyer's agent.

Then that commission is put in the MLS (Multiple Listing Service) where we list your home There we attract an agent who is working with a buyer and they potentially write an offer

Here's the change…

With the approval of the settlement, the buyer's agent compensation conversation will no longer happen between the seller/their agent. Instead,?that conversation will likely happen when the buyer's agent brings an offer to the seller, and at that time, the seller will be able to negotiate at the time of the offer, having a conversation about what that looks like.?

To put it more simply, what has changed is how the buyer's agent is going to be paid.

It might not be decided by the seller and the listing agent upfront,? it will be decided at the acceptance of an offer.

?Bottomline

What didn't change:

The commission didn't change.

But, what did change is how we might go about deciding how the buyer's agent will be paid And you know what… I love it!

I think it is in the best interest of everybody, the buyer, the seller and the agents.

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Questions?

Please feel free to make comments below, or better yet give me a call!

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