On August 17, 2024, the new rules agreed upon by the National Association of Realtors (NAR) and the Department of Justice went into effect. Many myths have sprung up regarding these rules. Here are the myths and the facts, according to the NAR website.
Myth 1: Sellers no longer have to pay the buyer's broker.
Fact: Sellers were always able to negotiate the compensation to the buyer's broker. This hasn't changed. But the listing agent can no longer advertise the compensation on the MLS. Instead, they can post buyer's agent compensation on their own broker-specific or listing-specific website.
To remain competitive, most sellers will probably want to offer compensation to the buyer's broker. That's because most buyers will not have the cash on hand to pay a compensation. As a result, fewer buyers could afford to make an offer on a listing that doesn't offer compensation to the buyer's agent.
Myth 2: Buyers will be required to pay the realtor's compensation.
Fact: The Buyer Broker Agreement will say that, if the seller does not pay the buyer's agent, then the buyer will. The agreement must have an agreed-upon fixed dollar amount, or percentage. Buyers can ask their agent's compensation as part of the offer.
Myth 3: Buyers need to sign a Buyer Broker Agreement before attending an open house.
Fact: Buyers can attend any open house with or without a realtor. However, buyers do need to sign an agreement with an agent before that agent can show them a listing outside of an open house.
Myth 3: Buyers can use the listing agent as their realtor.
Fact: The listing agent represents the seller, and is obligated to serve the seller's best interest. The listing agent can show the home to you as an unrepresented buyer. You can even ask them to do the paperwork if you want to make an offer. However, they are not representing you, and the deal may not be in your best interest.
Myth 4: Real estate agents will have to reduce their fees.
Fact: Realtor fees have always been negotiable, and will continue to be. This compensation has always depended on the agent's professionalism and level of service.
Myth 5:The settlement will lower housing costs.
Fact: The market and the laws of supply and demand, interest rates, and other closing costs also factor into housing costs.
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