By Lisa Marie Boyd, Managing Principal Broker & Owner
Town & Country Realty has provided expert, professional real estate advice and has successfully navigated industry changes for over 73 years. Recently you may have heard through a variety of social media and traditional news of a settlement by the National Association of Realtors (NAR) in a class action lawsuit. To clear up any confusion and debunk sensational and inaccurate headlines, let’s set the record straight with facts.
The NAR settlement addresses two issues that take effect on August 17th, 2024:
- Seller’s offer of compensation to pay for the buyer’s representation may not be listed on a multiple listing service (MLS) but may be listed on broker websites, advertised on flyers, or third-party websites.
- Buyers must enter into a written representation agreement with a broker that expressly identifies the buyer’s brokers fee for services before touring a home.
The consumer choices have not changed regarding real estate services and compensation. Commissions have always been negotiable and continue to be so. The NAR has never set commissions or suggested a “standard rate.” Each firm or independent broker has its own business model ranging from charging flat fees, payment by the hour, or a commission as a percentage of the gross purchase price.
While Buyer Representation Agreements have been best practice for many years and was considered optional, it is now required. When the buyer enters into a service agreement with a buyer’s broker, the buyer may elect to negotiate that the seller pay the fee upon presenting an offer to purchase, or they may elect to pay the fee themselves by bringing additional funds to closing. It is imperative for buyers to interview brokers and select an educated, informed, professional, full-service broker that can properly and smoothly navigate the buying process. A seller may offer and advertise a buyer’s representation fee as compensation to attract the most buyers to their property.
Some media has stated the proposed settlement is the end of commissions and it simply is not true. Nor is it true that home prices will drop. Home prices are driven by supply and demand. The Mid-Willamette Valley has had more demand than supply for decades, a trend we expect to continue.
In short, it remains business as usual with new ways, and restrictions, to communicate how each party is compensated. Regardless of the changes, Town & Country Realty brokers remain your trusted advisors. This will never change. Whether buying, selling, or just curious, contact your Town & Country Broker today to answer all your real estate questions. Call us at 541-757-1781 in Corvallis or at 541-924-5616 in Albany.