Back in March, the National Association of Realtors (NAR) entered into a settlement deal that includes substantial changes aimed at improving transparency in how real estate agents are compensated. Whether you’re a buyer or a seller, here’s what you need to know about the changes taking effect on August 17, 2024.
There are two key changes:
Offers of Compensation Not Listed on MLS: Buyer broker or buyer agent compensation offers can no longer be displayed on the Multiple Listing Service (MLS).
Written Buyer Agreements: Real estate agents must have a signed written agreement with homebuyers before giving property tours.
These changes might seem overwhelming at first glance, but most industry professionals will continue to provide the same high level of service. Here are six key points to help you understand what these changes mean for you:
What Homebuyers Need to Know
1. Homebuyer Agreements
Your real estate agent will need a signed written agreement before showing you homes. These agreements can vary greatly in duration and scope—some may cover just one property, some may last a week, and others could be longer. Always ask about the options available and ensure you understand the included services.
2. Clarity on Costs
The agreement will clearly outline your agent’s compensation. Make sure the terms are specific and understandable. Agent fees remain negotiable, so don’t hesitate to ask for clarification and get everything in writing before you sign.
3. Seller Incentives
Sellers can still offer to cover some of your closing costs, including buyer agent fees, as an incentive. Although these offers won’t be visible on MLS listings anymore, your agent can find out or negotiate them for you.
What Home Sellers Need to Know
1. Your Choice on Compensation
As a seller, you remain in control. You can decide whether or not to offer compensation to buyer brokers. Discuss the pros and cons with your listing agent to determine the best approach for your circumstances.
2. Transparent Terms
Your listing agent must obtain your explicit approval before making any compensation offers to buyer brokers. If you choose to offer compensation, the terms must be transparent and documented in writing.
3. MLS Restrictions
You cannot list buyer broker compensation offers on the MLS. However, you can still offer buyer concessions and agents may share that information directly with other agents, on their websites and social media channels, and by other means of communication. It simply is not allowed on the MLS or platforms that tie into the MLS, such as the ShowingTime platform that agents use to schedule showings.
Final Thoughts
These changes aim to make agent compensation more transparent. It’s essential to understand your options thoroughly by working with a knowledgeable real estate agent, ensuring a positive and successful home buying or selling experience.
For more information about these changes, visit facts.realtor or call me up!
If I can help you or someone that you care about, please reach out to me directly!
Thanks for reading!
Brandon Yopp