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NATIONAL ASSOCIATION OF REALTORS (NAR) SETTLEMENT AGREEMENT –
HOW DOES IT AFFECT BUYERS AND SELLERS?
industry news
What everone needs to know
HERE’S THE GIST…
A group of citizens in Missouri sued the National Association of Realtors over Realtor’s compensation practices. The NAR ultimately decided to settle, to avoid adding the heavy cost of an appeal to the already mounting costs of this class action lawsuit. The ruling will go in effect sometime in August 2024.
MLS CHANGES
Basically, NAR will no longer include compensation offers on the MLS. Further, the Seller will no longer be responsible to pay the Buyer’s Agent fee. Although, the Seller is not restricted from offering concessions to the Buyer for Closing Costs on the MLS.
REALTOR AND BUYER AGREEMENT
Also as part of the agreement, NAR will now require Realtor’s to have written agreements with the Buyer prior to each home the Buyer wants to see. This agreement will show the Realtor Fee as a fixed, verifiable amount, such as 3% of the sale price. Similar agreements are currently in use by some Realtors. Although they are not mandatory at this time and many Buyer’s do not want to sign them.
BUYER’S REALTOR FEE PAID AT CLOSING
As a Realtor I work diligently in an effort to bring the sale to a successful close, for buyer and sellers. Realtor fees have always been paid at closing. I don't expect this to change.
NOT TOO MUCH IS GOING TO CHANGE
The Seller pays to sell 3% now, and then another 3% when they turn around and buy again. It’s still 6% (fees have always been negotiable). I believe it was ultimately done this way, because the First Time Home Buyer has traditionally struggled to come up with the necessary down payment. Lender Fees, Title Fees, Inspections, Appraisals and other Costs, including Realtor Fees have all historically been paid at closing.
OVERALL, A POSITIVE CHANGE…
Most likely the Buyer’s Agent Fee will be adjusted to represent a Buyer’s Expense rather than a Seller’s Expense, and remain in the Closing Costs. The requirement of signed agreements with the Buyer, stipulating the Realtor Fee, is the only impactful change I see. Overall, the changes are positive, moving towards better communication with our customers.
WE ARE HERE TO HELP
As always, hiring a Realtor is a benefit to both the Buyer and the Seller. I believe most people realize the inherent value of having a Realtor to guide and represent them throughout real estate process. Take your time to learn and understand the process from the beginning to the end. This will allow you to gain the most possible from the potential equity in your property. As always, I am here to answer your questions and point you in the right direction.
