Homeowners and buyers, now that the National Association of Realtors’ new rule on commission is in effect, how does that impact you if you are selling your home or purchasing one?
Hi, I’m Tanja Odzak, eXp Realty. I love helping people. I’m a Senior Level Realtor and I help people sell and buy homes right here in the East Bay!
First, it is important to know, commission structures have always been a key part of a real estate transaction. Commission (or compensation) has always been negotiable. In the past, when a home was sold, it was the seller that was considered to have paid the real estate commission. In fact, it was paid to the sellers’ agent, “the listing agent” and they would pay a portion of that compensation to the buyer’s agent, the one who was representing the buyer.
With the new changes in law and based upon recommendations from the Department of Justice, sellers can no longer offer compensation on the Multiple Listing Service, however, they ARE still allowed to pay compensation by way of “concessions” to a buyer’s agent.
EVERY STATE is handling this differently. There are also over 600 MLS’s and each MLS is also handling it differently. Different States, MLS’s and Brokerages each have their own ways of navigating these changes. So what does all this mean? There’s a lot to cover here on this topic, so let’s break it down.
First of all, for sellers, these changes in commission could mean a shift in the financial dynamics of selling a home. With this new commission structure sellers may now find themselves negotiating commision differently when hiring their listing agent. Now more than ever it is going to be important to hire the right agent that stands apart from the competition and offers the best value for their compensation.
Sellers will need to focus on agents who can provide not just a good rate, but also exceptional service, negotiations and marketing expertise to ensure their homes sell quickly, with the most favorable terms for the seller. Our firm will be advising on the pro’s and con’s of commission structure and each scenario is different. But we will be letting sellers know that any compensation to a buyer’s agent will be coming directly from the seller, not via our brokerage. However, this does NOT mean we do not encourage a seller to offer compensation to a buyer’s agent.
For buyers, the new commission structure will also have a significant impact. More often than not, in the past, buyers haven’t directly paid their agents to help them secure their dream home. That fee, which was negotiable, often came from the seller. With this new ruling, buyers MIGHT need to factor in these costs to pay their agent directly a commission for their services. This in turn could affect their overall budget for purchasing a home. Buyers need to know the importance of having a strong agent negotiating on their behalf and compensation is now more important than ever!
With all these changes in compensation structures, it will be a new era of transparency and negotiation in the transaction between buyers and sellers, as well as buyer’s agents and seller’s agents. Having an experienced agent on your side to help with the negotiation process and add value to your transaction is going to be more important as this change is implemented. But remember, all things are negotiable between buyer and seller.
If you would like more information on this new ruling, Call me today and let’s talk about it. I’m a seasoned East Bay expert with a 5-Star rating. I’ll help you navigate these changes and make it happen, whether that’s selling or buying or both!
And if you or someone you know needs to sell a home, ask me about my home-selling plans.. I took the pain out of negotiating with a Realtor and made it SUPER simple. Really! Choose Silver, Gold, or Platinum- Pick your Plan and Pick your Price. Terms do apply. I’m Tanja and I sell homes. Let’s get you going, Call me today!
I’m a Top Producing Realtor® in the OAKLAND / BERKELEY / EAST BAY AREA. I’ve been in the San Francisco East Bay Area since I came up to do my undergrad at UC Berkeley (a long time ago!), with a short stint at UC Davis while getting my Master’s. I take my duties as a Realtor® and Fiduciary very seriously, I enjoy educating my sellers and buyers along the way. Putting People, Before Profit.
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