03/26/2024
How will the NAR class action settlements affect Texas consumers? NOT AT ALL. Professional fees paid for broker services provided by REALTORS®️have always been determined by the market, scope of services, and the selected broker’s business model. In other words, NEGOTIABLE.
Texas Buyer Rep Agmts will now be mandatory and must be signed PRIOR TO SHOWING, but most Texas REALTORS®️ have already been using those for almost 2 decades. Buyers will still promise to pay specified compensation to their REALTOR®️and the agents can still promise to seek payment first from the listing broker or seller, and any remaining balance must be paid by the buyer, just like it is now. Nothing has changed except the timing of when it must be signed.
Although countless brokerage business models exist, the one I have most commonly offered to my own seller clients involves a written contract containing a negotiated fee payable upon closing, from which I promise to deliver a specified marketing plan usually inclusive of signage, advertising, staging, and inclusion in a Multiple Listing Service (MLS) with an offer to pay an amount of MY earned fee, to the buyer’s broker as an inducement to choose our listing above others. In hot markets like we had a few years ago, many sellers opted to reduce or eliminate buyer broker inducements in favor of a reduced listing fee. In softer markets like we have now, most sellers opt to offer inducements. Regardless, yesterday, today and tomorrow, sellers will be given those options.
The BIG DIFFERENCE under the settlement is in how listing brokers can communicate an offer to compensate a buyer’s broker. Before, it (any amount from $0 to infinity) was communicated through the MLS under a unilateral offer. Under the settlement agreement, the one place it CANNOT be communicated is via the MLS. Only in this bizarre, anti-business, misguided consumer “help” world, could 7 MO jurors, a now mega-millionaire lawyer and the DOJ upend the most competitive, consumer friendly, and effective homeownership marketplace on the planet, to remove a single field from the MLS. It doesn’t change the cost of doing business or the market, and it doesn’t make sellers reduce listing prices. It doesn’t make professional fees any more or less variable or negotiable from broker to broker. It only makes finding those listing broker or seller offers to pay buyer brokers more complicated and difficult to find for the entry level buyers who need them most.
The one thing I know for certain is that REALTORS®️will continue to find ways to advocate for and deliver the American dream of homeownership, even to buyers who need help to afford representation. We R more than a million entrepreneurs whose century old Code of Ethics acknowledged then and now that consumers’ long term best interest IS our own best interest. We will adapt and thrive, because our eyes R always on the prizes When we achieve those, everybody wins.
