As the leaves change and October brings a chill in the air, a new landscape is appearing in real estate. The recent settlement involving the National Association of Realtors (NAR) has shifted how REALTORS© and Brokers handle Buyers and their commissions. Now that the dust has settled, here’s what you need to know about buying in today’s market.

The Settlement: What It Means for You

The NAR settlement has sparked discussions around transparency, specifically around who pays commissions and how REALTORS© are compensated. As part of the shift, Buyers now have a more direct role in negotiating the cost of their representation. This change offers more options but also underscores the importance of clear agreements between Buyers and their REALTORS©.

When is a Buyer’s Agreement Required

It used to be up to the discretion of the REATOR© for when the Buyer’s Agreement was officially signed. Now, though, a REALTOR© has to enter into some type of written agreement with the Buyer BEFORE the REALTOR© can do any home tours with the Buyer. This agreement ensures you understand who’s working on your behalf, what services are included, and how fees are structured. It’s a straightforward way to set expectations and avoid surprises.

Commissions: What’s Changed

A major impact of the NAR settlement is clarity – Sellers CANNOT be required to offer commission splits to the Buyer’s REALTOR©. What does this mean for you as a Buyer? In some cases, you may be responsible for covering your REALTORS© commission directly, rather than it being included in the Seller’s fees. This puts more emphasis on upfront agreements about who pays what.

However, this does not preclude you, as a Buyer, from asking for what is known as Seller Concessions. Even if Sellers are not offering automatic commission splits, Buyers can still negotiate to have the Seller contribute toward the REALTORS© commission by writing these concessions into the Purchase Agreement. These negotiated terms allow some flexibility, especially in a market where Sellers are motivated to close deals.

Learn More and Get the Facts

You can learn more about the NAR settlement here: https://www.nar.realtor/the-facts.