The real estate industry is about to get better.
I’m talking from real estate brokering, to the buyers and sellers.
Most likely you’ve read the headlines that came out last Friday, March 15. Headlines like, “The 6% Commission is Gone” or “Landmark Settlement That Rewrites Rules on Commissions.”
If you haven’t, read this.
There’s no surprise mainstream is positioning this as the real estate brokering industry’s wake up call. And how consumers have been scammed. But it’s not about that at all. This is an evolving industry and this is changing, to improve how it’s handled.
There are numerous real estate brokering changes that’ll take place this July, but the main idea is about who will pay commissions and how much. Having been in real estate for over 28 years, I’ve never seen a written document or been trained to say real estate commissions are 6%. Never. They’ve always been negotiable.
I’ve been a broker, agent, and investor, and have been involved in deals from 3.5% – 11%.
But these changes are not a surprise. Back in the 1990’s “Sub-Agency” was how deals were done. Here’s a decent essay to help you understand it. But around 1996, The Department of Justice (DOJ) wanted buyers to have improved and more protective representation. So they changed the rules.
For about 27 years, there have been listing (selling) and selling (buying) agents. With this new change, there will still be selling and buying agents, but how they get compensated will change.
The NEW Real Estate Brokering Models Will Emerge
No longer will a listing agreement be cooperative with the listing agent expressing how much commission the selling agent will receive. We see this in our MLS sheets now. But we won’t anymore.
The seller may offer a concession – for repairs or closing costs – to the buyer that includes what’s to be paid by the seller. Or, the buyer and buying agent may negotiate a percentage directly. There are more details in the first link above.
Starting in July, you’ll see Buyer-Broker Agreements that’ll be mandatory when a buyer works with a selling agent. Today in Florida, this is not required. There are a handful of states who’ve always mandated this agreement The agreement will provide buyers with representation. Without it signed, there is no representation. There may also be the negotiated commission in it.
There will be a lot more to share and explain in the weeks and three months ahead before it goes into effect sometime in July (no date confirmed, yet).
For me, the real estate brokering industry is about to get better. Consumers want Buyer Agents, but they want us to be better. With that, we will lose a large amount of real estate agents, and that’s most likely a good thing.
I strive to be a true, professional, real estate expert. I believe in, and strive to offer: sound research, due diligence, market knowledge, world-class skillsets, listening and negotiating skills. And, making your selling/buying experience exceptional.
I’m sure you’ll have questions. My email and phone number are at the bottom of this eLetter. Please get ahold of me. If I can’t answer your question, I’ll make sure to use my industry contacts to answer you promptly.
We’re in this together. I’ll keep you informed as I learn new details.
[photo above: My volunteer work for Delray Beach – Driving the Mayor in the St. Patricks Day Parade last Saturday]
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*** In my latest video, I show more data about our transitioning real estate market and what sellers should be doing today to sell their home.
*** Check out some new interior design trends to consider in 2024
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*** Surging Supply – UP 63% Since August 1, ’23 ***
* Last week there were 44,389 available…
* This morning’s Inventory is 44,509 *
… supply is UP 120 units in the last week ***
