NAR Settlement - HOT TAKES
I have a few HOT TAKES on this recent NAR Settlement News
1. Buyer's agents won't wait long to get into written agreement with a Buyer. Right now, many agents don't sign any agreements until they sign an offer. With this new system, I won't wait long to sign an agreement and spell out what commissions are owed. Many Buyers will refuse to sign, but will quickly see that no one will want to work with them for free without an agreement in place. This is actually not a bad thing for Buyer's agents, as we will encounter less tire kickers.
2. Prices of listings will adjust. The MLS market always included both sides of the commission. So if the Seller is not offering that commission, then the price of the home offered should be less, since the buyer is now assuming this responsibility
3. Many agents will leave the business. Again, this is a good thing. For many agents it can be a sigh of relief, as we no longer have to compete with incompetent family members for business
4. The market will drive commissions. In a sellers market, anyone can sell a home. This is why I believe this issue started in the first place. Sellers got greedy and wanted more money in their pocket because they felt they could sell their home on their own just by putting it on the market. While some of this is true, this won't hold true when the market shifts. In a Buyer's market, sellers offer LARGER commissions to Buyers agents in hopes of getting an offer. To the sellers thinking they are going to make more money, maybe not.
5. Buyers who don't have representation will get screwed. If a buyer doesnt want to pay an agent and goes directly to the seller, their interests are not protected. In the short term we might not see any issues, but overtime, cases will arise when Buyers start getting screwed in shaky deals. Its like going to court without a lawyer. The lawyer could've likely gotten you a shorter sentence.
What are your thoughts?
Who here believes that home prices do not include associated fees?
So as an investor when I run the numbers closing costs are included. The appraisal can come back with anything. We all know it’s easily manipulated. Let’s say the property is appraised and listed at 100k and I need to bring 110 to the table. If it doesn’t produce at 110 I may have to offer 90 to bring us back to 100 at the closing table. (Crude numbers just to give the idea.)
There seems to be an idea here that people aren’t doing that math before the offer. A good agent is showing this to their client while placing the offer. I just don’t see how buyers will just start paying more at closing. personal home buyers are often buying the very maximum they can afford. Those buyers are willing to pay the same exact amount no matter who the silly piece of paper says paid the fees…
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Quote from @Shane H.:
Who here believes that home prices do not include associated fees?
So as an investor when I run the numbers closing costs are included. The appraisal can come back with anything. We all know it’s easily manipulated. Let’s say the property is appraised and listed at 100k and I need to bring 110 to the table. If it doesn’t produce at 110 I may have to offer 90 to bring us back to 100 at the closing table. (Crude numbers just to give the idea.)
There seems to be an idea here that people aren’t doing that math before the offer. A good agent is showing this to their client while placing the offer. I just don’t see how buyers will just start paying more at closing. personal home buyers are often buying the very maximum they can afford. Those buyers are willing to pay the same exact amount no matter who the silly piece of paper says paid the fees…
we will see wont we.. right now today its bizz as usual.. BAC s are still offered although starting to see brokers requiring their agents to get a buyers broker contract in place before they can show them property. The process will find its equilibrium over time.. If you take a bunch of buyers agents out of the game it is going to bog down sales to a certain extent no doubt.
