How New Real Estate Rules Change the Way You Buy a Home

Today, I'm here to discuss some critical changes in the real estate market that could significantly impact your home-buying experience. If you're planning to purchase a home after August 17 this year, things might look a bit different from what you've encountered.

You may have heard some buzz about changes concerning how buyers' agents are compensated and the potential elimination of buyer agent commissions. These changes stem from a recent settlement involving the Department of Justice and the National Association of Realtors (NAR). The crux of the issue is an antitrust violation claim, where it was alleged that realtors were engaging in price-fixing commissions.

In the past, when you hired a listing agent to sell your home, the commission you agreed upon with them was typically shared with the buyer's agent, who helped bring a buyer to the table. This cooperative commission-sharing was the norm, but things are set to change moving forward.

From now on, sellers will indicate the exact amount they are willing to pay their listing agent for their services. Any compensation for the buyer's agent will be separate from this amount. This "decoupling" means that the buyer agent's compensation is no longer tied to the seller's commission to the listing agent.

Does this mean you, as a buyer, will never pay a buyer agent commission again? Not exactly. Instead of being framed as a commission, we may see compensation for buyer agents presented in the form of closing concessions. You've probably seen listings before where the seller offers, say, $10,000 toward closing costs, closing concessions, or rate buy-downs. The new compensation model might resemble these kinds of offers.

"An experienced agent can help you leverage the new compensation structures to your advantage."

Sellers may still offer closing concessions to cover buyer agent fees, closing costs, or other expenses, but it will be negotiable. Just because a listing doesn't mention a seller concession doesn't mean the seller won't agree to one—it's a point of negotiation, just like in any other real estate transaction.

If you’re buying a home, you will need to sign an exclusive buyer agency agreement before you can start viewing homes with the help of your agent. For example, when you find a property you like, and you want to schedule a showing, the agent you're working with will likely ask if you're already represented by a buyer's agent or if you've signed an exclusive buyer agency agreement. If the answer is no, you will probably need to sign an agreement outlining how that agent will be compensated for their services.

This compensation agreement is crucial because it acknowledges the agent's role in showing you the home, analyzing comparable sales, and guiding you through the complex home-buying process. The experience and expertise of your agent can significantly impact the outcome of your purchase, potentially saving you time, money, and headaches down the road.

These new rules show more than ever how valuable it is to have a skilled agent by your side, just like myself. With years of experience in the field, I can make a difference in your home-buying experience. Our guidance and knowledge can be invaluable, especially in a market undergoing significant changes like this one. If you have any questions or need further clarification about these new developments, don't hesitate to contact me at (813) 212-8300. I'm here to help you navigate this new landscape and ensure your home-buying journey is as smooth and successful as possible.