Have you heard about the significant changes coming to the real estate industry following the landmark Sitzer-Burnett case? If not, you’re in for some intriguing updates.
The case highlighted a crucial concern: many consumers feel that the National Association of Realtors (NAR) has crafted a system that may not always work in their best interest, often leading to inflated sales commissions. However, what’s less understood is the nature of the changes, their timing, and how they’ll be monitored.
Today, we’re here to clear up those questions.
The Multiple Listing Services (MLS) and local realtor associations have a deadline—August 17th, 2024—to implement and supervise a series of important changes. Let’s dive into what these changes entail and how they might affect you.
It is difficult to predict how these changes will influence or change the real estate industry but there are some obvious “good” things coming this August.
A clear and concise definition of what it means to “cooperate”. Cooperation as previously defined and practiced left many consumers feeling as if Realtors were working in the best interest of Realtors rather than the consumer in which they owed a fiduciary duty. This new definition will allow Realtors to have a clear understanding of what is and isn’t owed to other Realtors and makes clear that duties owed in the name of “cooperation” are never to take precedence over a client’s best interest.
The new policies increase transparency. Not stated in the main changes mentioned above is the increased transparency through “api” technology that will allow consumers to access all public information available on the MLS. Read the full statement below:
“A statewide data share should deliver MLS data through a common technology interface (e.g., API) of all data fields to all Participants of MLSs in the statewide data share. However, the data should not include MLS-only data fields that are viewable only to the listing Participant and the respective local MLS.”
Clear and negotiable commission structures for buyers and sellers. The new changes remove all cloudiness surrounding who is getting paid what and puts full control in the hands of the consumer regarding any commission changes. In the past, Realtors have changed how the total commission is being shared without the approval of the seller. Starting in August not only will commissions be clear but any changes to the total commission and even how that commission is being offered will have to be approved and signed off on by the client.
Required buyer agreements with a fixed commission. This change is significant as it will require that buyers and their against have a written agreement before touring property that will outline the services being offered and what the compensation will be. In the case that a seller agrees to contribute to that commission while negotiating agents will not be allowed to negotiate for a commission higher than what is agreed upon in the buyer’s representation agreement.
Change can be daunting, but it also opens doors to new possibilities. While we can’t speak for everyone, our team is genuinely excited about the upcoming changes. We see a bright future with a consumer-focused real estate industry that brings more value to our clients. Through clearer agreements, enhanced service offerings, and greater transparency, we’re looking forward to helping you navigate these changes and making the most of the opportunities they present!
