August is nearly here. That means that very soon, the offer of buyer agent compensation will come off Multiple Listing Services (MLS) across the country as a result of NAR settlements. Good riddance! In this post, let's explore what that means on a practical level.
If you're new to our blog and would like to read up on the backstory, just Google "NAR Settlement" or visit our blog posts here, here, and here. We've been staying ahead of these issues and are excited to continue putting the changes into practice!
In 2019, we founded R+K Real Estate Solutions to be able to provide a different approach to our community; one that anticipates change, and constantly adapts to serve each individual client and their unique situation. Real estate should never be one-size-fits all! No two clients are the same and no two houses are the same. Our mission from the very beginning has been to offer solutions to our clients we didn't feel were available elsewhere. Think full service real estate with aggressive negotiation regarding commissions. Overwhelmingly, the coming changes to the real estate world are positive and needed changes the public feels are long overdue...we believe most people would prefer to work with a real estate company that's adaptable and prepared to leverage coming changes to benefit their clients rather than clinging to the old way of doing things. We are ready!
So, here's a quick update on what we intend to do starting next month:
- On August 12th, the offer of buyer agent compensation will be removed from the Lawrence MLS. Any new listings going live from that day onward will be for 1% total commission. Our listings will not include offers of buyer agent compensation. Rather, we will negotiate directly with any buyers and and/or their agents on the Sales Contract itself, to be able to achieve the best solution for each unique client and transaction.
- Any active listings will be altered to remove offers of buyer agent compensation. All listings will be moved to 1% commission!
- For our buyer clients, the path forward is a little trickier. We are watching the situation as it evolves. There are concerns we have regarding the changes and whether or not they go the full distance to make ALL commissions negotiable ALL the time. Right now, we feel some of the changes are insufficient in this regard. Specifically, if the seller participation in the buyer broker's commission is stated on the contract, does it change what's specified in a listing agreement? What we want to avoid is a situation where we have a buyer interested in negotiating the commission offered directly with their agent and the seller, and let's say they negotiate the buyer agent commission down to 2% of the sale price. If the listing is a 6% listing, does that mean the listing agent gets 4% and the buyer agent gets 2%? In this were to occur, clearly commission wasn't negotiable. At least, not in the sense that the buyer assumed in their offer. Without getting any more into the weeds, we'll say simply that we have potential solutions for this situation and each situation will likely be unique.
- As part of the new requirements from NAR, we are required to sign a written agreement with our clients prior to showing any homes. Our buyer agency agreements will be for 3% of the sales price. However, we are willing to negotiate our commission downward, as low as 1%. Again, this will vary situation by situation. In the event a seller is offering a 3% commission to buyer agents, we will still offer our clients our Buyer Rewards program.
- R+K Real Estate will continue to look for new ways to adapt to and thrive within a rapidly changing real estate environment and push for changes that benefit our clients and the public in general. Transparency has always been a core value and we will pursue any advantage that we believe will result in success for our clients in a dynamic and developing market environment.
Since these changes were announced earlier this year, Ryan has been hard at work with involvement in implementation of these changes at the association level, both as a Regional VP with the Kansas Association of Realtors and participation on the Lawrence Board of Realtors' MLS & Rules Committee and Forms subcommittee. The situation is ongoing and there are still a lot of unknowns going forward. Much will become clearer as the real estate markets respond to behavior in the marketplace. Changes in real estate forms are important, but even more important is how those changes effect the buyers and sellers and their agents who use those forms. Rest assured, we will be monitoring these changes very closely and responding in way that benefit our clients!
In the meantime, stay tuned to our blog for continued updates on the Lawrence real estate market. At R+K Real Estate, we value transparency, education, advocacy, and empowering our clients with the very best services via our skills in negotiation and our experience in the local real estate industry.
