Understand the recent changes: tweaks in listing agreements and the new ways buyer's agents are compensated.
Are you prepared for how the latest changes in real estate could impact your success as a seller?
I’m back with part two of our series on the changes in real estate. Some of you have been very in tune with these updates, while others might not be. Today, I’m covering how these changes affect sellers and what that means for you and us when working together.
In case you missed part one, we discussed two key rules handed down from the Department of Justice and the National Association of Realtors due to a lawsuit earlier this year: offers of compensation can no longer be in the MLS, and agents cannot show properties to anyone without an agreement in place.
“You can now list your house with no co-broker fees—but is it the right choice for you?”
Now, let’s look deeper into how these changes impact sellers:
Changes to the listing agreement. The first change affects our listing agreements. Previously, under broker compensation, we outlined the fee we charged you, and on page three or four, we detailed how that fee was split with a co-broker or outside agent. Now, the broker’s fee and the compensation for the other broker are combined into one section. This change simplifies the agreement but introduces a critical option: you can now list your house with no co-broker fees. While I don’t recommend or encourage this, it is available. Avoid limiting your property’s exposure by not offering compensation to buyer’s agents. Doing so might lead to fewer showings and a longer time on the market. If you choose not to pay a buyer’s agent, someone else has to come up with that fee, which can lead to constant negotiation. I’m more than happy to discuss the pros and cons of this approach with you.
Additional forms and agreements. Since offers of compensation have been removed from the MLS, our company now provides this information on our website under the broker compensation form, which any agent writing an offer on one of our listings can access to see what we’ve agreed to pay the outside broker. We use several forms to ensure transparency: the Addendum Regarding Broker’s Fees outlines how the outside broker gets paid; the Compensation Agreement Between Brokers is an agreement from broker to broker; and the Compensation Agreement Between Broker and Owner details the compensation arrangements. If you decide not to pay a co-broker or outside agent fee, you must agree directly with the buyer’s agent to determine their compensation.
These changes may seem complex, but I’m here to guide you. If you’re considering listing your home, I’m happy to explain these changes in detail and help you make the best decision. Call me at (210) 305-5665, and I’ll assist you in managing these new real estate rules.
