Impact of recent ruling on buyers agents going forward

Impact of recent ruling on buyers agents going forward

New to Real Estate · Member since 2022 · 3 posts · 2 votes

I was reading some articles (like the one linked here) about there being a federal ruling late last year regarding how buyers' agents will not receive direct commission from home sales in the future. https://www.paloaltoonline.com/real-estate/2024/02/20/after-...

However, my cousin, who is currently a buyers agent with Compass in CA says not much will change, stating that if buyers' agents aren't paid, then who will connect homebuyers with the right sellers?  I also received my broker's license tho (solely to become more knowledgeable while making personal real estate investments), but I don't see their logic, so I figured I'd turn to BiggerPockets to help me better understand what's going on. Any insight into the below questions is much appreciated, and I look forward to reading your responses!

Thank you,

John

Questions I have (both generic to buyers agents overall and about the potential impact of the recent ruling):

1) Do sellers still have incentives to work with buyers' agents? What do buyers' agents provide to the transaction?

2) What do the best buyers agents do that sets them apart? Or, in other words, what do the best buyers agents do that can't be replaced by technology / self self-representation / etc?

3) How will buyers agents make sure they'll be paid in the future? Will their commission drop due to the ruling?

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  • Russell BrazilBusiness Member
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    Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
    2y

    1) Do sellers still have incentives to work with buyers' agents? What do buyers' agents provide to the transaction?

    86% of transactions involve buyers agents. This is unlikely to change. Transactions with unrepresented buyers have a substantially higher change of falling apart. 

    2) What do the best buyers agents do that sets them apart? Or, in other words, what do the best buyers agents do that can't be replaced by technology / self self-representation / etc?

    Get the deal closed. Buying real estate is highly emotional. People think that's even different for investors...the fact is, it isn't. Coaching buyers til the end, setting expectations, these things won't change.

    3) How will buyers agents make sure they'll be paid in the future? Will their commission drop due to the ruling?

    a) commissions will be written into offers going forward, just like they are in commercial real estate.

    b) commissions are likely to rise due to the changes.

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