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Real estate commission lawsuit - changes coming!!?!?!

Sligh1

Sligh1

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I have a meeting today on it. I would guess it will have an impact on reducing commissions. It’s hard to say.
 
deerdown said:
Let us know the details when you find out please
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The settlement states that realtors will not be able to offer a seller side commission. So on the MLS or on a dual agent situation, there will have to be a separate contract. If a buyer works with his own realtor he or she will have to arrange compensation.

This could lead to reduced commission overall . I would say likely ?
 
I see this getting rid of people that do real estate casually as a side gig. The top dogs will capture their business. Rates will become competitive amongst realtors. It will be interesting to see where the dust settles on "average" rates for various things. Wild ass guess.... id say 4% on a median house become more the norm instead of 6%.
 
It will definitely weed out the small realtors. We usually offer 5% and 4% if we sell it in within our agency already.

Depends on the size. It could mean big land or farm tracts will be 3%? Hard to predict.
 
I could certainly see 3% becoming the norm. There's enough "small" realtors/brokerages that will be able to survive on 3% for land listings just fine.
 
Hardwood11 said:
The settlement states that realtors will not be able to offer a seller side commission. So on the MLS or on a dual agent situation, there will have to be a separate contract. If a buyer works with his own realtor he or she will have to arrange compensation.

This could lead to reduced commission overall . I would say likely ?
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I prefer to have my own agent when buying, so I hate to hear that. The seller finds his agent and in my opinion that agent has primary interest in the seller, not the buyer . I have bought some directly from landowners with no agents involved at all,and that seems to work pretty good.
 
@tall@wide —I agree! My wife has dozens of clients that trust her with knowledge of the market, legal issues, negotiation, etc.. from a buyer and seller standpoint. They feel the representation is well worth it !

She is a realtor and was a former Paralegal. It’s not easy for everyone, most need help !
 
Absolutely terrible for people looking to buy their first home/property, now they’ll have to come up with the buyers agent commission on top of down payment and closing cost. Don’t think many people are going to be happy when the find out they can’t even look at a property until they sign a buyers agreement with a realtor.
 
MarkF said:
Absolutely terrible for people looking to buy their first home/property, now they’ll have to come up with the buyers agent commission on top of down payment and closing cost. Don’t think many people are going to be happy when the find out they can’t even look at a property until they sign a buyers agreement with a realtor.
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I don't really understand the need for a buyers agent......
 
IowaBowHunter1983 said:
I don't really understand the need for a buyers agent......
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Historically, the seller finds an agent he knows or chooses. The buyer can either use the seller's agent or get his own agent that represents just the buyer at no expense to him. I strongly prefer an agent solely representing me and not the seller's friend representing me in the purchase. Most times the seller's agent will represent you fairly but there are times when having a buyer's agent is advantageous. When you pay 100's of thousands or millions for a farm, I want my interests solely looked after by a buyer's agent at no expense to me.
 
I understand wanting someone to look out for your best interests and yours only, but a lawyer can do that also. I have done real-estate deals with and without realtors. When not using a realtor i have hired a lawyer to review paperwork, do title searches, etc. at a fraction of the cost of a realtor.

I prefer without. i have a hard time understanding how a realtor provides $30,000 of value on a $500,000 sale. I can see how they provide $3,000 on a $50,000 sale though. I don't dislike them and respect anyone that is out making an honest living.

In the days before the internet I can see where realtors were an absolute must for buyer and seller. But now with almost every listing available to see at anyone's fingertips it takes away a lot of the benefit they used to provide by being able to provide options to buyers.
 
2-bucks said:
I prefer without. i have a hard time understanding how a realtor provides $30,000 of value on a $500,000 sale. I can see how they provide $3,000 on a $50,000 sale though. I don't dislike them and respect anyone that is out making an honest living.
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Agreed. I foresee the potential of "flat rate" type deals coming in the future. Possibly a sliding scale depending on the size of the property and marketing options that the sellers agent offers. Overall, I see this as a win for buyers and sellers. It gives them the power.
 
I am a our United Country Realestate Conference right now in Texas. This has been the main topic of conversation. After sitting in hours of meetings my understanding is that this whole case revolves around offers of compensation on the MLS. The settlement states that offers of compensation can still be negotiated between the seller, sellers agent and shared with the buyers agent. It just cannot be on the MLS and there is to be no standard rate. Very complex case and some parts have not been settled yet.
 
IowaBowHunter1983 said:
I don't really understand the need for a buyers agent......
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There’s a lot of buyers that work with an agent for years. The agent has knowledge and experience of the area and they trust that. They feel they are represented with negotiations, disclosures, home inspections, past history of the home, etc..

I will use my wife as example, she has a long client list, and she knows the homes in the area, and the market & will be honest with her clients on price and quality of home. She steers buyers away from expensive overpriced homes for example. We see many buyers get burnt in this type of market .

I also sell real estate, but mostly land. I’ve seen many for sale by owners leave 100k-300k on the table … to avoid a commission. Just saw one a month ago, that sold for $3600 an acre and it was worth $5200 an acre .

Im a farm “junkie” so my knowledge of land/farms is better than 99% of the realtors in my area…. so some buyers use me regardless and they will get the whole land review if they buy through me . If we walk a farm, I can also point out what the new owner could do with the farm and what programs it might be eligible for, what type of hunting to expect, cash rents, CRP, types of trees.

We have realtors in this area that post listings such as … “CRP is guaranteed renewable, and you can put in “feed plots”:rolleyes:

You want them to represent you ??

It’s a free market society and commissions are negotiable as they always have been. We don’t charge 6%, it usually ends up 4% and we make a living at it . To be honest 3% would work, but anything less and it’s tough to make a living unless you have incredible volume. We spend 24k just in advertising every year and insurance is very expensive.

That’s just my feedback.. I am sure the commissions will drop and some realtors will leave the market —& that will be a good thing overall in my opinion!
 
IMO, another consideration regarding buyer's agents, please correct me if I am wrong about how this goes down...

A not tiny percentage of farms these days sell BEFORE they are listed for all of us other schlubs to see. The scenarios that I am aware of seem to follow this pattern:

Qualified and "ready to rock" buyers line up with an agent that has some stroke in the area that they are working in. When a sellers agent is preparing a listing, and prior to listing it, they contact fellow realtors privately to see if they have any "hot" buyers chomping at the bit.

A meetup of some sort is facilitated between seller and prospective buyer and a deal is struck prior to the farm ever being listed. I know this happens, I just don't know how common it is.

So...in the above scenario, without a buyers agent repping you...you probably don't even know the subject property is in play. Now then, if it is openly listed...well yes, anyone with a laptop can look up a lot details themselves and potentially transact it without an realtor.
 
The off market deals do happen quite a bit. If a seller lists with an Agent that is not a member of an MLS then they can keep it to themselves or market it in any way they see fit. If the listing agent is a member of a local MLS the listing must be online within 24 hours of the signed listing.
Other times when I have connected a buyer and seller on a property that was never intended to be a listing we still have to put it on the MLS. It just shows up as pending the minute it goes online
 
Daver .. yes that is called a “pocket” listing and the commission is 2-3% typically. It can be a good way to buy a farm !

I see that as more common in the future.
 
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