“Determining The Relationship” with Your Realtor: Two Major Changes All Agents Must Implement in August

In last week’s article we discussed one of the changes Realtors will legally be required to implement as a result of the NAR lawsuit settlements; no longer are buyers’ agent’s commission offerings allowed to be posted for other agents to see in any multiple listing service (MLS) in any way. Sellers can still offer payment to buyers’ agents but making those commission offerings viewable by Realtors on these professional platforms is no longer allowed. 

Instead, these commission offerings will likely be posted on brokerage websites and will be communicated one-on-one between Realtors when they are calling one another to schedule showings to see properties. 

Members of the public may not experience the impact of these changes directly at first, but it will add some additional steps to the buying process for the agents who represent buyers. It’s the compounding effect of this change coupled with the second required change in practice where the added complexity rears its head.

The second big change Realtors will have to implement is the requirement that agents must have buyers sign an exclusive contract known as the “Buyer’s Representation Agreement” with them prior to providing buyers with any services. This means that before an agent is ever able to show you a home you have to sign a contract with them. 

Gone are the days of calling a Realtor and asking them to schedule showings for you before you’ve “determined the relationship” with them by discussing your finances, your buying power, your level of preparedness to purchase, your ability to pay the agent or terms you are willing to include in eventual offers that will cover their commission charge, homes you want to include in your home search (which may include limiting criteria such as “only show me homes where the seller is willing to pay the buyer agent’s commission).

That’s a pretty high level of disclosure to make with someone you’re not SURE you want to do business with, exclusively, don’t you think? So, my advice for buyers is this: do your homework. Research area Realtors. Interview several of them to see who you really want to work with, someone who will bring value, experience, time, effort, attention, and customer service to you during your buying process. Someone you want to commit to over the duration of your home search, not just use for the day because a house just hit the market and you really want to see it. 

Also, using area Realtors to “open doors” for buyers who plan to eventually use a relative or friend on another side of the state once they find a home they want to purchase won’t really be possible either. That change isn’t one I’m complaining about as a Realtor though. The standard has been raised for both Realtors and the public and this has the potential to benefit everyone if we let it. 

The duration of these exclusive contracts can vary in length, but really, are you looking for someone to work for you today to see one home or are you looking for someone who is willing to prioritize you as a client until you’ve found the home you want to buy? Someone who will actually bring you value… Don’t just call the first agent who is able to unlock a door for you anymore, this choice of who you want to work with (exclusively, after signing a contract with them) should be an educated and intentional one. Both industry practice changes are set to take effect on August 17, 2024. 

Tune in next week to find out what the new streamlined process for buying a home may be, when and how to interview a Realtor, and how to avoid pitfalls during your next buying
experience.