NAR settlement: Consumers stand to benefit the most, real estate analyst says
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- Опубликовано: 22 май 2024
- The National Association of Realtors (NAR) settled a lawsuit in which a federal jury ruled the organization had conspired to artificially inflate commissions. The group agreed to pay $418 million in damages and amend several rules around commissions.
KBW Managing Director Ryan Tomasello joins Yahoo Finance to discuss the settlement and how it may affect other players in the housing market.
Tomasello explains that consumers will have the most to benefit from the settlement: "We think these changing enacted in the settlement, if it goes through, are gonna stand to reshape the housing market in the greatest fashion we've seen in over 50 years. Historically, consumers have lacked a lot of transparency around the process of how commissions are set and paid, particularly home buyers. We think that these changes ultimately bring a lot more knowledge to home buyers in their ability to negotiate and sign off on those commissions. At the end of the day, hopefully that reduces commissions in aggregate by as much as 30% or more, we've estimated."
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Lower commissions will result in higher net proceeds for sellers, not lower prices for buyers.
Higher cost for buyers will result in less buyers, less buyers results in less competition, less competition results in less price appreciation. Time will tell if this change will bring prices down, but as long as we have a shortage of inventory, it’s not likely. The solution to home prices is to build more homes so that we have less of a supply and demand issue.
Commissions have been negotiable and transparent. Any agent NOT practicing negotiable commissions and transparency is completely unethical. This major disrupt will be but a minor hiccup once buyers and sellers are forced to see the value of a true Realtor "the hard way". Many more lawsuits for the unrepresented on the rise...
Uneducated (New) buyers are screwed
Forcing buyers agents to show buyers that they are in fact earning their commissions is a good thing… the days of taking a 3% commission for granted are over
@@HQSCJIPZ
Yup,
Like I said their screwed.
No representation for them.
They get what the pay for and for most that's not going to be much representation
@@dougg4633 more clueless buyers means more opportunity for new buyers who are willing to invest in a good agent at a reasonable price
The lawyers are the big winners in Any settlement anywhere always
If they are trying to push out buyers agents than a new law needs to pass that any person purchasing a new home needs to take a course on the fundamentals of a real estate transaction. If not then I can see a lot of issues and lawsuits
If transparency is what they were looking for, how is removing the competition more transparency?
The individuals most impacted by this are the buyers, especially those purchasing their first home, along with FHA and VA loan recipients. It remains to be seen how the FHA and VA will react to these changes if this is implemented. Additionally, it's crucial for everyone to remember that the primary principle in real estate is the importance of location. And what's the second rule? Remember, everything can be negotiated...EVERYTHING!
NAR agents were caught steering buyers to deals that gave higher commission to the NAR agents and away from low commission deals.
How did that jump to not paying the buyers agent?
This could be a huge opportunity for real estate portals. Free for buyers as usual. Free for sellers - except if they sell to a buyer referred by Zillow, but will only need to pay fraction of the 3% commission. Then tie in ancillary services like mortgages, title, etc. Everyone wins except buyer agents.
So who will represent Buyers ?
And don't say an attorney.
They only care about the transaction and won't get a deal done. In fact the more deals an attorney can crush the more transactions he can charge for
You could say the same about most buyer agents. Maybe they continue to exist who knows. But the average buyers won't have the cash to pay them upfront. So the market will become even more fragmented from a buyer's perspective. Whichever way you look at it, these portals will become even more significant for buyers.@@dougg4633
@@dougg4633 Nobody, it's going to be so easy to make mistakes as a buyer and the investors will be happy to be able to do whatever they want in the market.
I like when people can just simple say... I DON'T KNOW instead of a song and dance..
What does a home buyer do if they don't want to work with a buyer's agent? How do they have access to view homes that are for sale? Who writes the offer to the seller? A home buyer will be at a great disadvantage trying to buy a home on their own without an agent
The attorneys are the biggest beneficiaries.
Plaintiff's attorneys are the big winners. Buyers are the big losers. On top of all time high home prices, buyers that want representation will now potentially need to come out of pocket to compensate their agent.
But sellers have been the big losers for years, paying out of pocket for the buyer's agent fees...what's your point? I don't understand what's so hard about this; sellers pay their fees... buyers pay their own fees... what's the problem? The logic that it's unfair that sellers no longer have to pay for the buyer's fees is ridiculous. Also, presumably, all buyers become sellers at some point, and most sellers become buyers again. If buyers can't afford the fees associated with the purchase...maybe they can't afford the purchase. Just a thought.
Appreciate the appreciation my friend. Be the bigger person
I’m looking to buy a house soon. Why should I expect the seller to pay for my own agent, who acts for my best interests and not the seller’s interests?
@@pinky882 The seller can decide how much they want to pay for the co operating brokerage, they can go with 1 dollar is they thing is in their benefit.
Go look at how much home prices have gone up. Sellers are the beneficiaries. The median income cannot afford a median home. Now you want the buyers to pay for an agent too? Best of luck to you in your home search.
I’m in the process of buying a home in Kansas City MO but I don’t know if I can stop the process after paying inspection , and other fees, I don’t know what to do 🤦🏻♂️
If you have a realtor, they should be able to tell you how. Otherwise, maybe talk to an attorney to review the documents with you and see what your options are. Good luck!
You can look at inspection report and see if big items that need expensive repairs can be negotiated. If not, that is your out of the contract
nothing will change if you need and want to sell you will pay what is needed for that to h appen if you are able and want to buy said house you will pay the said price
The only winner is the sleaze attorney Michael Ketchmark.
By prohibiting Realtors from posting buyer commissions online, how does that possibly improve transparency?
Once buyer commissions are no longer financed with the sellers fronting them, the average buyers in the bottom 90-95% are screwed. Buyer agents will still work their commissions into the deals, just without buyers knowing the details up-front.
Guess who will be getting all the sweet deals when distressed sellers aren’t allowed to cover buyer commissions? Those deals already exist today and most buyers can’t get them for the same reason. This change will only expand the number of such deals. The rich will win, as per usual.
Having novice home buyers negotiate commissions with seasoned professionals? Yeah, that won’t be terrible at all, for the real estate brokers. And the idea of doing hourly pay for service deals must be good right? After all, that’s why everyone keeps saying how cheap hourly lawyer fees are.
Oh the humanity!
Because it’ll prevent buyers agents from only showing me properties with the highest commissions. My agent should show me the best properties, regardless of commission
@@HQSCJIPZHahaha. Yep, what a ridiculous idea right?
@@HQSCJIPZ Who choose that agent? And if you ask to see a home and they refuse why don't you fire them on the spot?
@@HQSCJIPZhow so? Every listing currently shows buyer agent commission visible to anyone that reviews the listing. With this settlement, the commission for buyer agent is invisible to the buyer. This actually makes things less transparent for buyers.
@@notnotnownow9622 sure they’ll show you the home if you ask them, but what about homes you miss because you don’t have access to the MLS? Listing the buyer’s commission on the MLS creates a perverse incentive for the buyers agent to steer clients towards listings with higher commissions
Consumers? Home buyers obviously stand the most to lose.
nope 👎 not buying with these high prices don’t care i’ll wait