Dear Clients & Friends, 

   I want to address the National Association of REALTOR®s' recent settlement to resolve a class action lawsuit that has been in the news so much this year. One of the settlement terms is that the MLS will no longer allow for listing agents to make offers of compensation to buyer’s agents, which is how it has traditionally been handled. To comply with this settlement, the MLS removed all offers of buyer’s agent compensation as of Tuesday, August 13^th. 

   Commissions always have been and will continue to be negotiable. I highly encourage sellers to continue to offer concessions to the buyer’s agent, for many reasons including the following:

• We expect offering concessions will open the seller’s house to a larger field of potential buyers as the buyer’s agents have a clear path to being paid for their services.
• Buyer concessions can make a seller’s house more appealing to buyers by reducing the amount of money the buyer needs to bring to the table.
• Requiring the buyer to pay cash up front to their agent has the potential to impact their qualification for a favorable mortgage.
• Without a buyer concession, it is likely that the buyer will reduce the amount they can pay the seller as they will need to reserve funds for the buyer paid commission. This is additionally negative for sellers when several other sellers offer concessions, and they do not. 
• Without proper buyer agent representation, there is a greater risk for negotiation, inspection, contract, and legal issues.

   In my experience, I believe that continuing to offer the buyer’s agent compensation will put your house at a competitive advantage over listings that will not offer any type of concessions. Furthermore, a seller can agree to offer a concession but does not need to agree ahead of time exactly how much of a concession to offer. It is a negotiable term in each offer that is received. 

   Also in affect as of August 13th, buyers will now be required to sign a representation agreement with their agent before he/she can show them property. This representation agreement confirms the buyer’s agreement to pay their agent should they purchase a home where a seller is not offering a concession to the buyer’s agent. There are two kinds of representation agreements that buyers can sign. One is specific to up to three properties only and is valid for 30 days. The second is valid up to three months and covers all properties within a geographic region.

   So far, most sellers are willing to offer concessions to buyer’s agents and continue business per usual. Please feel free to reach out as I’m sure there are many questions surrounding these new practices. As always, I’m here to help guide the way through the changes. 

All my best, 

Courtney