The Real Estate Industry Has Changed (Kinda)

We’re sure you’ve heard about the changes in the process of buying and selling homes that just went into effect across the country.

We’re happy to report that after the first weekend, our colleagues say transactions went fairly smoothly. There’s more paperwork for sure and some of the procedures will take getting accustomed to.

For example, real estate professionals cannot show potential buyers properties without signed contracts stating what buyers will pay realtors for their services.(That is if the seller does not continue to follow tradition and compensate the buyer’s representative.)

These changes come as the result of a settlement agreement following a lawsuit against the National Association of Realtors (NAR) that you may have read about.

Is this new procedure a law?

No.

Do realtors whose companies are covered by the settlement have to follow it?

Yes.

Today Real Estate is one of all but a handful of brokerages across the country that are part of the agreement and as a result we will be following the new rules and procedures.

There’s been a lot of reporting about this, especially when it comes to impact on home prices. Unfortunately, much of it has been inaccurate and left us wondering if anyone in the media ever bought a house.

There was a reasonably accurate story last week in the Wall St. Journal about the changes. It’s headlined “So Much About Real Estate Commissions Just Changed. Here’s What To Know.” We can’t share the text because of copyright, but if you can access the article, it’s worth the read.

One unstated change we see coming is that the days of listing agents working with buyers is pretty much over, except for unique cases such as transactions between family members.

It’s never been in a buyer’s best interest to work with a listing agent, whose fiduciary responsibility is to the seller. In these situations, buyers who do not have their own representation are forced to manage a very complicated process alone, or at least hire an attorney to help with the paperwork. Attorneys are not real estate professionals, either, so even their knowledge of how the industry operates is probably limited.

And a warning to first time homebuyers. This is not how your parents or favorite uncle who “knows a little something about real estate” purchased their homes. Don’t let them tell you that the real estate professional you’re talking to is trying to hustle you by getting you to sign a contract. If you’re working with us — and we hope you would be — we’ll be happy to sit down with Mom, Dad, and Uncle Bob to explain the new process.

Are you ready to buy and/or sell a property? Do you have questions about the new process? Please let us know at 508-360-5664 or [email protected]. With interest rates the lowest they have been in a year, this is a great time to market your home or purchase one.

Let’s talk soon…

Mari and Hank