Embracing Change: How the NAR Settlement Affects You | Tom Ferry Show
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- Опубликовано: 9 июн 2024
- Welcome to The Tom Ferry Show! In this episode, we're diving deep into the buy side actions you need to take to navigate the new real estate rules. Join us as we discuss the latest updates and insights from the recent NAR settlement. Learn what actions to implement now and gain clarity on the timing of these changes.
Plus, get valuable advice from our expert guests, including Jack Miller, CEO of T360, David Child, CEO of Keeping Current Matters, and Coach Alysia Essig, former president of her Association. Don't miss out on this essential guidance for protecting your business and livelihood in the evolving real estate landscape. Watch now and stay ahead of the curve!
If you’re worried about how the NAR lawsuit will affect your business, it’s time to start embracing change. Watch or listen, right here. And then be sure to register for “Embracing Change Pt. 2: The Listing Side of the NAR Settlement” happening April 4! Sign up here: hubs.la/Q02r76Tw0
0:00 - Intro of the buy side & NAR settlement webinar
3:00 - NAR settlement and what it means with Jack Miller
16:15 - David Childers on mortgage rates & the market trends now
20:59 - Tools to help you be the educator by Tom Ferry
45:35 - Working with Home Buyers in 2024 with Coach Alysia Essig
Blog post: tinyurl.com/2yuua6bg
Download FREE Business Plan: tinyurl.com/2bj46g2m
Freebie Agent Tools & Resources: tinyurl.com/2c8mobel
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For the majority of my life, I’ve been passionate and dedicated to changing lives by giving away the very best strategies, tactics, and mindset techniques to help you and your business succeed. Join me as we take this to level 10!
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#NAR #realestateagent #housingmarket #nationalassociationofrealtors
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There's no level of experience or value proposition that would make a buyer agree to pay 2.5% out of pocket. Don't see a world where this is the norm. My guess is a flat fee will become a standard. Time will tell.
If flat fee becomes common the level of service will dramatically be reduced.
Buyers will still request sellers to pay their agent’s commission. If sellers decide not to pay, buyers will move onto a different house.
@@danielroberts3484 if buyers find a house they like enough to put an offer on, and the seller agent offers something but maybe not the standard…..and the buyer has to walk away over it, it won’t be long before they are very angry at the BA for the commission causing them to loose the deal. They might have to suffer through the first BA agreement, but they will eventually drop the BA and find one who will negotiate if this becomes a problem for them. Especially if they didn’t take much of their BA time, only saw a few houses, found their own, etc. They will be thinking the BA should lower the commission to get the deal through in those instances and be grateful for what the seller is offering.
Never in history or will there be a buyer who says, “Yes, let’s pack up and walk away from this dream house because I will never sleep again if my BA doesn’t get the full “standard commission.” 😂 Pairing both sides to the seller is the only thing that has kept this gig going as long as it has.
Homes are emotional purchases….buyers RARELY use logic when purchasing a home. I have also found buyers will absolutely fall in love with, and ask to see, homes they don’t even know they can afford because they aren’t pre-approved (thanks to BA who frequently comply with this idiotic request in my area). Buyers look and watch houses on Zillow all the time they can’t afford, it’s an American obsession. Do you really think they are all just going to pass over wanting to look at that house they are drooling over because the commission might be lower than the BA wants? Not likely, they will just call the seller on the side….as someone who sells new construction….it happens all the time anyway. 🤷♀️
@@Apheem How many people are finding the house they want on the internet? Last 2 homes I bought I knew I wanted them before I even talked to anyone. So it was just put the offer in, let me get my checks done, and buy.
@@danielroberts3484 bingo.
By 4/4, register here to attend Embracing Change Pt. 2: The Listing Side of the NAR Settlement: hubs.la/Q02r76Km0
It takes me right into my zoom account and ask for a meeting code. Nothing about registration.
@@ricagreenwood click the ‘Send code’ to securely verify your address. The code lands in your email inbox to enter in and the webinar will be accessible. See you next week!
Appreciate you guys keeping us all focused on what’s important right now !!😊
Appreciate all the valuable info Tom & guests!🌟🌟
Thank you for watching!
Appreciate you all for your knowledge and keeping us moving forward
Love Chris Voss’ book. I’ve listened to his audiobook 10+ times. So cool that you mentioned “Never Split The Difference” and know Chris Voss!
Just came across your video - you make some excellent points. I believe you are glossing over major themes. 1. The public at large was uneducated on the real estate process as a whole (this is just how its done) - now disclosure of compensation is negotiable & not a requirement. 2. Economics/competition will put pressure on sell side commissions (mandatory in place sell side agreements will allow property owners to opt out buy side compensation) this is the whole basis of the lawsuit making it illogical to assume prior buy side compensation will go back. 3. It will be much harder to conduct business from the buy side with buyer compensation field being eliminated from MLS. (a purging of brokers can be expected) & that side has never paid a commission & will resist. 4. Getting buyside clients to sign the required agreement that has to explicitly outline compensation - no open-ended wording is allowed (your pre-show agreement will not be compliant) is going to be extremely challenging to brokers, especially new ones. 5. Buyers will seek homes from listing agents/agencies direct - paying (2) fees for (1) transaction will be a thing of the past in time. 6. Listing agents will be unwilling/can't compensate the buy side because it commission compression as you articulated.
We covered a lot of what you're questioning here, maybe finish the video? I agree it will be different, I don't believe agents will be flocking from the business. Tragically last year 49% of realtors sold 1 or 0 homes. I don't know or even think about what they will do. The balance, this is their business. They will pivot and adjust. Like they always do with changes.
@@TomFerry Of course. It’s Darwinian.
@robertdarcey8923 In 2009, did you believe that your medical bills would go down AND that you would keep your doctor after Obamacare went into effect??!! 1. The public is STILL uneducated in the whole process of buying/selling real estate including: financing, construction, zoning, local policies, differences in construction over different decades... just to name a few categories that effect buying real estate. Now that disclosure of compensation will be a requirement, agents who only "present" properties to clients will not be highly paid. Much like going to a Minute Clinic for a sore throat vs. an ENT surgeon. 2. Like physicians, if an agent is experienced and brings value of discernment to looking at homes with the buyer, then they will get paid well. 3. Just the opposite of your thought process, I think Buyer's side compensation is going to finally get the recognition it deserves. It will not take long for people to realize that you want someone leading the charge to get you good value with all of the variables that come in the marketplace. It takes 3-4 years of study to be really good at being a Buyer's agent (and even then an agent will have knowledge gaps in areas with widely diverse housing). 4. Like physicians, or attorneys, you will be able to find a cheap real estate agent, but I do not think a consumer will mistake that person for a prudent, thoughtful real estate agent acting as a fiduciary. 5. Those who do not know history, are doomed to repeat it! 1986 government survey revealed most buyers thought that they had representation of their own when the agent was a sub-agent to the listing agent. THAT is how Buyer's agency was born in the late '80's! Do you really think a Buyer will be dumb enough to think that they will get equal representation from that dual agent?? Are you buying a $3M home and trusting that you can use the same agent and that you don't need your own expert advice? Really?? 6. Listing agents will also look at closing stats. Great agents have a lot of closings - a track record. You can rest a bit easier when you know the other agent is knowledgeable and thorough. Details get handled. Questions get answered. Yes, sometimes the seller must answer hard questions or face a secondary negotiation for condition of the property, but the discerning questions get asked and answered. I think you are under-estimating both the public at doing their homework in wanting help as well as the listing agent in wanting the highest sale and easiest transaction for their seller.
Thank you Tom and all.
Your presentation has been amazing. Very helpful for Realtors to adopt the coming new rule.
I'm happy to hear you got value from the webinar!
Thank you Tom !
i just attended a 1 hour masterclass on this adjustment in our business. That you Tom!!!
Glad you enjoyed it!
Thank you so much Tom and guests for sharing this! #BysonMode
Buyers agency was created to make sure that all people were represented and had access to representation to buy a house. All this has done is made sure that first time home buyers and those with less money will no longer have access to representation. Good job lawyers !
Plenty of realtors try and double end deals.
Should the realtor turn the client away until he or she has their own representation?
That’s not accurate. Go read the settlement. The seller can still pay. It just can’t be advertised on the MLS
@@davidedwards7594 Texas doesn’t allow dual representation. And the sellers won’t be offering to pay the buyer’s agent. Therefore, most buyers will not have any representation.
The liability on the sellers and the listing agents is going to rise because those uneducated unrepresented buyers are going to make lots of mistakes.
For clarification, we will be required to not only have them sign a buyers agency agreement prior to showing any home, but that also must include the terms of compensation. I did not see that discussed in this video when Tom is talking about "dialogue." Did I miss something?
Yes, the amount of compensation in the buyer agency agreement needs to be explicit in both the amount (whether flat fee or percentage) and how it is to be paid.
Thank you for your tutorial Tom, I look forward to what you can send us.
16:55 I remember back in January when there was a 75% probability of a rate cut in March and March is essentially over.
Great video! Learned a lot. I have been a Realtor in Texas for 15 years. I would like to be a part of your freebies.
I found this show very helpful. Was part 2 the listing side a recorded event? Is it possible to access that show if I missed it?
Thank you for giving us the talking points and roadmap to move forward through this change! This is exactly why we are Team Elite clients! By the way we have doubled in size in the last 6 months!🏆
I am betting that most listing agents will be educating their sellers on the value of offering buyers agent commission. Why limit your buyers pool?
I think the reason for the lawsuit to begin with is that Listing Agents have NOT been honest with their clients about commission splits.
@@lifelewkslessons often times indirectly favoring dual agency for compensation. This disruption is needed, and agents need to sell off leases for instagram posts. 🧼
Why would the buyer pool be limited? Buyers agents have an incentive to show properties that meet the needs of their clients regardless of expressed compensation for the buyers agent. It doesn’t necessarily mean the buyers agent wont get paid it just means you have to negotiate and work for it. I think In a sellers market adding concessions would show your cards too early.
@@fremontasbecause many buyers barely have enough for their own closing costs let alone our commission.
Great session. How do we get the slides?
Within 10 days, everyone will receive the webinar recording and slides to their registered email address. Coaching members will also have the replay recording inside illūm.
So thankful friend sent me the link to this webinar. Crucial info! How can I get the goodies and slides Tom mentioned? Thank you, Panel!
Within 10 days, everyone will receive the webinar recording and slides to their registered email address. Coaching members will also have the replay recording inside illūm.
Hello, Tom. This was great informative session. I look forward to learning more about real estate tutorial. Thank you so much.
More to come!
Wonderful show! How can I receive the slides?
All the listing appointments I’ve had since this settlement began had the sellers asking me if they could still offer buyer agent commission because they want to incentivize the sale and get the most offers possible.
My advice will always be to offer it (obviously at the sellers discretion).
Asking is irrelevant. What is the agreement they actually signed? Once these changes go into place competition/commission pressures will make it impossible to offer any type of meaningful buy side commissions. What are you going to offer 1.5% to be split with the agency? Nobody’s working for that low percentage.
@robertdarcey8923, I advise my sellers to offer a 3% commission to the buyer's agent. If the buyer's agents choose to reduce their commission to be more competitive, that's their prerogative. Our focus should be on the final net proceeds to the seller, considering not just the purchase price but also the terms of the sale. Incentivizing buyer's agents typically generates the best outcomes, as evidenced by my listings selling at 5%, 10%, or even 27% above the asking price. Moreover, if the market dynamics shift and listings begin to linger, offering an attractive commission split becomes even more crucial.
There have been instances where I reduced my fee to give the buy-side agent a larger portion, making the listing more appealing. Since many buyers prefer to have representation, and if they're required to pay for it out-of-pocket, they might just look elsewhere. Ultimately, the decision lies with the seller, but my counsel will always lean towards offering competitive compensation to ensure the best possible sale results.
Just watched this video. Took 5 pages of notes. Thank you Tom! Can I still be added to the 12 listings in 12 months starting in June?
Solid message on reminding people that they are problem solvers and have a lot of time to tackle this one. That’s the message I’ve been telling my partners from the moment this news came out.
Thank you so much for watching…hmu!
Please send me the list of 90 WAYS TO SERVE YOU. I can't find it on the website. Thank you! 🙂
Tom, please explain why most people coming from online leads won't simply go directly to the listing agent? Also, you keep talking about getting the "job." If I wanted a "job" I could have stayed in corporate America or in government, I stay in sales because I have zero interest in being an employee - I run businesses. If the point of this is to turn buyers agents into employees that is an even sadder state of affairs.
Can I get a copy of the slides?
Within 10 days, everyone will receive the webinar recording and slides to their registered email address. Coaching members will also have the replay recording inside illūm.
Great info! Is there a way to get a copy of the "90 ways we serve you". Maybe it was emailed out to those who watched live, but I only saw the replay :(
Not a realtor, but as soon to be seller, thanks for confirming that its probably a good idea to stick with compensating the buyers agent.
Thanks for watching…hmu! ❤
You can’t just arbitrarily compensate the buyers agent unless your agreement with the property owner is directed and agreed to. You have to tell the buyer agent that there’s no compensation or go back and redo the contract with the seller. The property owners are not gonna agree to that. If he wants the property, let him buy it if not, no thanks.
You should always be open to offering a buyer funds to close escrow including paying part or all of their agent commission as an incentive to make an offer. That being said, that doesn't mean you just show your hand up front. Remember buyers will already have an agreement on compensation with their agent even before they show your house. Let them request how much they want. Why offer 3% when 2% will do the trick? If you have an agent that just insists on your offering buyer's agent compensation, then (IMHO) you need to find another agent.
@@robertdarcey8923 That is INCORRECT. There is nothing in the NAR settlement that prohibits a seller from offering a buyer compensation to assist them in paying for their agent. Look at section H paragraph 58 sub-paragraph (xiii) which specifically states "this Settlement Agreement shat NOT (a) prevent offers of compensation to buyer brokers or other buyer representatives off of the multiple listing service; or (b) sellers from offering buyer concessions on a REALTOR MLS" It just says an offer of compensation can't be listed on the MLS. Furthermore, subparagraph (v) allows agents to list "offers of compensation to buyer brokers or other buyer representatives but only on listings from their own brokerage". So a broker can list offers of compensation on their own websites on listing they own.
@@benvigilrepro you are not permitted to direct the sellers funds or commissions at will. It Hass to be directed by the listing property owner.. if you plan on paying any buy side commissions that has to explicitly say that in your agreement with the seller. You will not be able to do what you just posted.
how do I get copies of the slides?
I watched the video of this super webinar and would love to be included in the FREE offer if there is still room
For more details, we wll send updates to your registered email address. If you do not see any updates to your email, I will make the announcement on my socials as well!
Where can I find the 110 page settlement document?
Bro , you are better off adding a loan officers license and making up for tge loss in commission income
@@KaranSingh-wu8qq I appreciate your opinion. With all due respect, though, I have another plan.
Can we get a copy of the Slides?
How do you get on the free list to get help to get 10 new listings??
I believe it was for folks on the webinar only.
I was in the webinar and awaiting info on how to get 10 new listings.
Hey Tom. I missed the live session for the buyer side, and caught the recording. Learned a lot! I've registered for the seller/listing side. How can I get in on the free marketing for 100,000 agents that you talked about? Thanks!
Thanks for watching…hmu! 🌕
How many persons have an EIN or LLC and active bank to receive funds
what happens to all the money froim the settlement?
The one question I had was, if a Brokerage is allowed to post commissions on their website, Brokerages like Re/Max, Douglas Elliman, and National Brokerages that have thousands of agents, isn't that similar to a third-party site that would post commissions? The doj isn't concerned about companies of that size broadcasting commissions?
For all of you reading silly headlines that think this is the end of realtors or things along those lines. . .
The only things that are changing is agents cannot advertise compensation on the MLS, and buyers must have a signed agreement to view an MLS listing prior to seeing it.
Nowhere does that say the seller cannot be the one to pay that agent. Nowhere does it say anything about any of that.
If I were a realtor (I am not) I would want to negotiate my own pay. I would have no issue negotiating what I want to get paid as a buyers representative. I would not want the listing agent negotiating that with their client and deciding what they think I should get paid.
Also, I would have no problem letting the seller and their agent what my client has negotiated my pay to be and I would expect the seller to make that payment for me bringing them a buyer.
Sorry, at 56:00 I don't see how that script will help, people are smart enough (at least in my area) to know how commission is equally paid by the buyer & seller no matter how you word it. Buyers pay for their commission because it's factored into their purchase price, and sellers also pay because it is deducted from the proceeds they receive. My point is, that script doesn't work on smart people. 😅Let me know if you think otherwise.
Good point. While I think having a good value presentation will certainly help, that doesn't mean a buyer will just lay down and pay 2.5% of the purchase price of a house (Some will.). If they ask a seller to pay it, a smart buyer might realize that asking too much in buyer compensation will potentially weaken their offer. The seller is going to accept the strongest offer with the best net to themselves. If a buyer offers the same price as another person or even a bit higher, they may lose out because the other offer wasn't asking for as much or possibly nothing at all for the buyer agent commission.
I don’t know about the “paying it forward” part.
I just watched your amazing seminar and Im registered for Part 2 for sellers. Can I please be added to the Free monthly starting in June if there is room. Thank you
😅😅😅😅 enjoying the realtor tears 😅😅😅😅😢😢😢😢😢
This is going to be great for realtors
how do i get this stuff Elite
I learned more from the woman realtor and I wish they had given her more air time than to Tom Ferry.
Hi Tom, I watched the Vid. Great info im a new agent. How can i get the free info for the 100,000 agents you mentioned. I would love to be in the room…. Thanks!
💬
As a BA can you call the LA to see what the compensation will be, if any.
I've heard you can but I also heard that may be seen as a form of steering.
How do you get on the list to receive 10 new free Listings?
For more details, we wll send updates to your registered email address. If you do not see any updates to your email, I will make the announcement on my socials as well!
In light of the pending settlement, why would a listing agent not continue to advocate for including a buyer's agent fee.....
1. Will listing agents be prepared to accommodate every showing onsite, if the seller opts not to cover the buyer's agent commission? Typically managed through key code access (or the like) for the buyer's agent.
2. Additionally, how does the listing agent plan to manage their availability across multiple listings, considering the logistical challenges of attending every showing? Something typically managed through delegation to the buyer's agent. This will certainly impact a listing agents capacity and annual earnings potential.
3. Alternatively, is the seller willing to assume the responsibility of granting access to unfamiliar parties, a task and associated risk typically handled by the buyer's agent?
4. In light of security concerns, if the homeowner assumes the role of hosting the showing, are they fully informed about the implications of their interactions and statements made, in terms of financial considerations and ethical standards in real estate practices?
I'm dropping my rate to 2% total. The extra listings we get around here will easily pay for the extra paper we are pushing.
I am seeing this in the markets I work in as well.
that's not true ..they paid the comissions though the purchase price
All I see are realtors trying to make sense of the situation but don’t seem to understand that the consumers are the ones that decide how this all plays out. A buyers agent better start working a little harder- wining and dining their clients.
All the surveys are great. When buyers actually have to open their wallet, it will be a different story. We just stripped representation from first-time buyers and veterans. Wow, isn't this a proud moment
Tom, this isn't about simple adaptation, this is about creating a caste system where first-time home buyers will get screwed and will have to "take it and move on" because they won't have the money to hire an attorney to fight for them. Only the C-suite and above think this is "progress" in transparency and consumer protection.
Why? The seller can still be the one paying. I think you misunderstand the settlement
@@InvestingWithAdamK Please point out exactly where it says the seller will be paying buyer agent compensation.
@@PatriciaChafatelliRealtor I did not say will. I said “can”. The seller “can” pay the buyers agent commission. It cannot be advertised on the MLS, and the buyers agent will need to negotiate their own compensation with their client. However it can be negotiated that the seller pays that and I would imagine more often than not the seller will pay it. If not, it may take them a long time to find a buyer who will cover it themselves
@@InvestingWithAdamK Thank you! I read the settlement. I agree some sellers will. The part of the country you are in as well as your market and who the big players are will dictate how this works out. I have been doing 24-30 sides a year for over a decade and I looked at the money I earn versus the stress that will be involved with this change and I have decided I no longer want this kind of stress in my life. Time for different choices. Good luck!
@@PatriciaChafatelliRealtor sounds good. I think it’s the best opportunity ever for agents. The buyers agreement will make sure clients don’t go behind peoples back working with other agents. I also think people will be more likely to pay better than a listing agent negotiating a buyer agents fee for them. If clients understand the seller can still pay I don’t see them not being fair about it.
I am glad this will be required nation wide. In my market this has been required BUT many agents refuse to have a buyer broker agreement signed until a house is found. I have lost business before because X agent does it without an agreement. I have explained compensation to my buyers since I started. I’m so thankful my broker trained me with the understanding that the buyer has the responsibility to paid the fee due to the buyer brokerage
Aah poor realtors, huge pay days are over 😭😭😭
I would highly doubt that
P,ease add me to that class
This rule is removing transparency on buy side Commission while it is asking us to be transparent. What a bunch of Bologna
Flat Fee all arouund no more % commissions never had to pay that just like never had to pay a buyers agent.
I’m not a realtor but following how this shakes out. What he said about “your income is in direct correlation to the value you deliver to the market place” is the rub for me. The value of a realtor is the same regardless of purchase price. IMHO, it should be an a la carte fee or hourly rate. Not a knock on the services realtors provide. Your time, effort, and knowledge is worth compensation, but the commission structure based on percentage of the sale price doesn’t make sense. It creates incentives for the realtor that are not in line with the customer’s best interest. At least that’s my perception.
So then you just don’t believe in commission, correct? Because that argument could be made for any commission position.
Exactly, creates incentives not in buyers best interests
I used to think that as well. Then I saw an agent in my office negotiate $50,000 in favor of the seller he was representing. Without getting into the details, most agents wouldn’t have been able to do what he did. This was on a home that was worth maybe $1.2 million. there’s no way he could have done the same negotiation if the home was only worth $400,000.
I agree 100%.
For example: I sell a 1m property in one day after listing to a person who found it on the internet. Where is 30k worth of time or value?
This exact issue led to me getting licensed myself strictly for my personal buying and selling.
@danielroberts3484 it is simple flat fee and something written in for value add.
I'm an executive and we use various law firms with bill hour rates between 250 and 1200. My expectation when using 1200 an hour attorney that they are efficient due to how well they know the subject matter. This attorney has 7+ years of education and 15+ of experience. Took me a few months to get licensed and no degree required.
The model worked when homes were 150k for starter house not at over 300k now. Industry didn't adjust they just took the windfall.
I've sold two homes for around 1m, Bought 3. Got tired of feeling like I got screwed so I took the courses.
At 55 minutes, 10 seconds, she presents the tax script as if the only options for people to respond is yes or no. A lot of people respond with things like... What does this regarding? What do you want? Etc
Artificial Intelligence (AI) combined with education will change, decrease than exit 90% or more of the current agents.
I agree but only when AI can get a real estate license.
@@benvigilrepro Ben, surely you jest. Buying and selling real estate is easy for the homeowner. What you need is access to sellers with homes, forms (templates) to complete with instructions, access to closers etc. I see this happening now and believe in 3-5 years astute buyers and sellers will throw realtors to the curb. I’ve seen this coming the last 5 years. Even Ray Charles would be able to see. If I was a broker today I would position a company that marketed a FSBO help service. I would use AI to market contacts of buyers and sellers, furnish paperwork that is used in the market area I was penetrating and provide help and guidance at completing forms and consulting closers. I have sold multiple properties for friends and strangers for free as a hobby. The process is simple. Realtors sell the process as difficult, I would say it’s more like changing the oil on your car, you might need instruction initially but it’s not hard. The most difficult step in the home selling process is finding the buyers and sellers and putting them together. Walli…Artificial Intelligence!
Hi Tom, you teach me this 20 years ago. Be a professional.
I think buyers will look for agents offering low fixed commissions and I’m sure they will be many all competing for a slice of the cake.
Thanks for watching…hmu!
Flat fee is the furure. $500 to tour 10 homes and 10 offers.
@@Starfish2145 $5000? 🤣😅🤣No way!
No thank you but thank you for your time. I’ll go look at the house myself since I have the address.
@@robertdarcey8923 you can't just go knock on the door and ask to look around.
@@rkelly976 of course you can who told you that. I can Google the address and find out who the listing agency is. Walk into the office and make an offer. The listing agent has a fiduciary responsibility to bring all offers to the property owner. It’s over for the buy side. Don’t listen to any of these idiots. Transition your business to the sell side exclusively.
@@robertdarcey8923You can’t view a home listed on the MLS without a buyers agreement prior to seeing the property starting either July 1 or August 1. You may have the address, but unfortunately you can’t “just see them”
Thank you Tom!
My pleasure!