3 Simple Takeaways You Should Know…from the National Association of Realtors Settlement




I have been a full-time broker for more than 15 years, and though my primary role is facilitating the sale of real estate, I also educate consumers on best practice and updates that affect you. Though the information below is relevant to all states, I’m specifically speaking to my home state of Washington.

 

The Association (NAR) has reached a proposed settlement with the plaintiffs in the case brought against NAR, but it is not yet finalized and could change. For consumers, the settlement creates added transparency around brokerage compensation and how brokerages are paid. Traditionally, in real estate, the seller has the responsibility to compensate both the listing and the buyers brokerage. The buyers financial responsibility traditionally has been downpayment, closing costs and appraisals and inspections. That could now change.

 

The first change, which was already signed into law here in Washington State and took effect January 1, 2024, is that buyers of residential real estate are now required to enter into a Buyer Brokerage Services Agreement with their broker/agent. This document outlines what their brokerage will be compensated and is required to be signed before any property is shown and can be cancelled at anytime before a contract for sale is finalized. If the seller does not offer compensation as has traditionally happened, the buyer will now be responsible for compensating the brokerage/agent representing them. 

 

The second change decouples the buyer brokerage compensation from the listing brokerage compensation, which we already have been doing in Washington. Sellers have already had the choice to pay or not pay a buyer brokerage. Because that compensation is advertised in the MLS, it could affect how quickly the property sells if the compensation is at a reduced amount. That leads us to the third point.

 

The new change says, the MLS cannot publish a sellers offer of compensation to a buyer brokerage - essentially evening the playing field for all properties to compete on terms other than brokerage compensation. If this change is approved, it will take effect in Summer of 2024.

 

What this means for you as a consumer? Work with an experienced broker/agent who will guide you through these new changes. Sellers still have the option of creating a competitive advantage in the marketplace through various means like having an attractive home, priced appropriately with competitive terms and offerings that will still give homeowners the best chance for a great sale. 

 

And for buyers, understanding the value that your broker brings to the transaction is key. Market research, negotiating, contract law, inspection repairs, appraisal reviews and so may other critical components are just the tip of the iceberg of what buyer brokers offer. And because they only get a percentage of the brokerage compensation, they’re often hustling to make sure your transaction closes successfully. 

Ask great questions and hire a broker/agent that can navigate these changes with you.

If you're looking for guidance on making Western Washington your next home, please register here so we can connect. https://erikmolzen.bhhsnw.com/Contact/erikmolzen 

RealEstateUpdates NARSettlement BuyerBrokerage MLSChanges WashingtonRealEstate BuyerBrokerageAgreement BrokerCompensation RealEstateMarket ConsumerEducation SellerAdvantage BuyerGuidance MarketResearch ContractLaw NegotiationSkills HomeBuyingTips BrokerExpertise TransactionSuccess RealEstateAdvice MLSReform

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