NAR Settlement and Rule Changes

The market has been relatively quiet in the lead up to the Federal Reserve's meeting on interest rates the week of Sept 17th. Although recent economic data remains relatively strong, markets remain optimistic that the key policy rate will be cut by the Federal Open Market Committee.  This has already begun to have a positive impact on the market as signs of homebuyer demand have perked up in recent weeks.  However prices continue to rise in certain price points that has helped keep homebuyer sentiment restrained. 

Inventory has started to slowly climb as more homes come to market.  Pricing has been absolutely critical when listing a home to get the most amount of qualified buyers through to generate offers.  Interest rates have already improved by about .5% in the last 2 months bringing more sellers and buyers into the market.  The contingent home seller and home buyer have become much more a new normal in today's market. 

The experience of buying or selling a home is much different than transactions in the past.  A recent National Association of Realtors class action settlement agreement has laid out new rules that will now bring change to both Sellers and Buyers. 

What does this mean for Buyers? Buyers will now be required to sign a written agreement with their agent before touring a home.  This contract must explain the buyer-broke fee, as negotiated by the buyer and agent including the specific services that will be provided by the agent.  These agreements have many items to discuss and can be for no more than 3 months.  The Seller may agree to offer compensation to the buyer's agent but cannot be shared on the MLS.  Buyers may also ask sellers to pay the buyer's agent compensation and other concessions but may have a limit based on loan type and size. 

What does this mean for Sellers?  Sellers can offer compensation to buyer brokers; however, the seller's agent must clearly disclose and document the seller's approval of the payment that will be made to buyer brokers. 

This can all sound confusing and I encourage all sellers and buyers to reach out to me at 858-220-6412 with any questions on what the new home buying and home selling process is.  Our homes continue to be many families biggest asset and it is important to receive clear guidance whether buying a new home or selling your home.  Call me so we can discuss your real estate goals.