By Barbara Lehrer
Real Talk
Barbara Lehrer
The distinguished and unique profession of real estate is an intricate and ever-changing process. The relationship between the realtor and the client is now highlighting representation compensation, and this is an opportunity to remind the community of the work that is done to complete a real estate transaction. Exceptional real estate agents make market knowledge part of their daily lifestyle. How many professions can say that?
Soon the compensation for buyer agents will not be on the multiple listing service. The fee will become an addendum to the contract in most cases. In other words, each transaction will need to negotiate the cost to have representation. Commissions were always negotiated, though there was transparency lacking in some parts of the country. We have had a buyer broker representation obligation in Connecticut since 1997. A buyer has been obligated to pay for his or her agent.
Until now, buyer agent compensation was stated on the marketing information from each individual listing on the multiple listing service. Now the buyer views a home, creates an offer with a complete package of costs needed. Here is where your agent creates the process to move forward with each individual contract. This fee could be paid through the transaction from the seller’s realtor. In this case the buyers give the sellers the money and the sellers accept a price knowing the real estate fee and how they will be paying it out.
This will not be the case in all deals moving forward. Each individual sale will require contract transparency up front.
In a market where prices are high and rates are high, a seller can incentivize a buyer by offering to continue to cover the buyer broker commission. Removing that incentive shrinks the buyer pool by making the seller’s home more expensive. A buyer may choose to offer less when the seller’s incentives are not offered.
There have always been “for sale by owners” and discount brokers where we, as realtors, created the individual transaction to satisfy both buyer and seller. We rise to the top as professional agents assisting creative ways to help clients successfully buy or sell. Realtors can no longer bring buyers into a home without a written agreement regarding representation, except for open houses, where it must clearly be stated that the host agent works for the seller. There are a variety of buyer broker commission forms available for compensation which serve to assure both agent and client that there will be no surprises.
Hiring a professional can net a seller more. Hasn’t that always been the goal? Contact a professional realtor as a buyer or seller to see how to structure a contract that helps you reach your goal of buying or selling.
If you need more information on these issues, email Barbara.Lehrer@cbmoves.com.