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How real estate brokerage ruling could impact home buyers and sellers
Hello Everyone,
Here is a great read regarding Agent fees & commission caps for new buyers that you should start seeing in the near future !
This post from CBS news could be a HUGE interest to you. this is a MAJOR INSIGHT on what the Industry could come in contact with in the coming months~
” Experts said this week’s legal verdict that the powerful National Association of Realtors (NAR) and several large brokerages conspired to inflate home commissions could eventually reduce real estate agents’ fees and, crucially, lower costs for home buyers and sellers. At a minimum, the jury ruling will likely lead to greater transparency, long a source of confusion and frustration for consumers about where their money goes in real estate transactions.
The vast majority — or nearly 90% — of U.S. homes are bought and sold through real estate agents affiliated with NAR. The organization, the country’s largest trade association, requires home sellers to offer a non-negotiable commission before listing homes on its property database, known as the Multiple Listing Service, or MLS, which feeds into real estate sites such as Zillow. Paid by the home seller to their agent as well as the buyer’s agent, the commission currently stands at around 5% to 6% of a home’s sale price. “
Please read & let me know …
What is your thoughts on this?
Is this a positive or negative impact on you personally?
Were all getting ready for next year and hoping and wishing for the market to ease with inflation ASAP – Will this be a huge factor/reason for buyers to get back into the market? I think so, especially with the closing costs we have all been seeing ” Lately ” ( for a while now ) on your borrowers to get deals done, I think this will open up a chunk of the buyers market that we haven’t seen in a while.
Honestly, from an Account Executives point of view, Closing costs kill deals just as much as rates can ~
https://www.cbsnews.com/news/nar-lawsuit-verdict-real-estate-agent-commissions/
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4 Replies
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Not sure why my prompt came out with codes, but here is my last statement~
****Were all getting ready for next year and hoping and wishing for the market to ease with inflation ASAP – Will this be a huge factor/reason for buyers to get back into the market? I think so, especially with the closing costs we have all been seeing ” Lately ” ( for a while now ) on your borrowers to get deals done, I think this will open up a chunk of the buyers market that we haven’t seen in a while.***
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**Honestly, from an Account Executives point of view, Closing costs kill deals just as much as rates can ~
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Wow. Very informative article Cameron. Thanks for sharing
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Rulings from the real estate brokerage can affect the Commission Structures in several ways. Here are some that come to mind:
Commission Structures
It will also involve altering the commission structures across all platforms. Some rulings may change the commission structures, changing the fees buyers’ selling parties incur. This can, for example, reduce consumer costs if a ruling restricts brokerages from other fees.
Reduced Cost: The Maurice Commission also explained in his article that increased competition promotes lower rates and other goods and services, particularly among real estate agents.
Access to Information
Assemblage of MLS: He supports his arguments by stating the importance of public access to real estate brokerages. He believes such rulings change multilevel service standards, target information transfer efficiency, and increase market mobility and efficiency.
Moreover, by aiming for more expansive listing practices, such brokerages help lower transaction costs, increase competition, and reduce information asymmetry in the market.
Market Competition
Launching competitive bidding: Following the ruling, it is natural that competition increased between the brokerages, leading to better service and cost reductions. Most importantly, more competition may spur better changes and greater use of progressive moves in the industry.
Effect on Discount Brokers: If the laws benefit traditional brokers, discount brokers will find it difficult to operate, narrowing the options available to consumers.
Consumer Protection
Tighter Laws: Certain decisions may have the effect of enacting a law to provide further protection to consumers by imposing stricter rules on brokerages so that buyers and sellers do not get the raw end of the deal.
Resolution of Conflicts: How issues between buyers and sellers, brokerages and agents are addressed and settled would impact the speed and effectiveness of resolving the problems.
Market Environment
Change in Buyer/Seller Behavior: A decision may change how brokerages operate, affecting how buyers and sellers conduct business. For instance, if brokers’ commissions have changed, this influences the price charged by the exporters.
Effect on Prices: If the issues make the operations of real estate agents more open or if there is a higher degree of competition there, this would impact the price of real estate on the market.
Real estate brokerage decisions are likely to change the conditions under which the purchase and sale of properties are conducted regarding costs, information availability, structure, and interacting policies. It is important for any participant in real estate transactions to be aware of these changes.
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