How a Buyer’s Agent is Paid
August 17, 2024 will bring about some new changes in how real estate is done across the country for Realtors!
There are two major changes that will now be law:
- Buyers must enter a buyer agency agreement with their agent before touring any homes virtually or in person
- All offers of cooperating compensation (what the seller is willing to pay a buyer’s agent) are removed from the MLS, but can still be offered by sellers and advertised anywhere else except the MLS. The buyer’s agent can call, text or email to find out what they are offering.
Want to read more? Here is a link to the National Association of Realtors Fact Sheet about this settlement.
These required buyer agency agreements may make a buyer a little nervous if they aren’t familiar with the agent, the processes or how real estate is going to work going forward. I want to ease your mind and explain them all to you! Give me a call and we can set up a time to go through them and answer any questions!
There are three major agreements that govern a real estate transaction. The first is the listing agreement between the seller and listing agent. Traditionally this agreement has pre-negotiated what the seller is willing to pay the buyer’s agent, which has usually been half of the fee the listing broker charges. It was always advertised on the MLS for agents to see before showing homes. It ranged from a specific dollar amount all the way to 6 or 7% of the home price.
In the last 365 days of closing in Dripping Springs ISD 100% of the closings offered a buyer agent compensation.
The settlement between NAR and the DOJ has proposed a change to make it more transparent to the buyer by having them sign a buyer agreement up front with the buyer stating what their fees will be for representation.
The listing agent and seller no longer have to offer a buyer agency fee, but I am expecting most of them to still offer it. The buyer’s agent will have to call each listing to see if they are offering anything before showing so that it can be provided as information to the buyer. In trainings I’ve been in they are saying to just put the buyer agency compensation in the offer as usual and negotiate it as part of the contract like it has always been, there is just more paperwork involved.
If you don’t want to pay the buyer’s agent out of pocket then you can instruct me to only show you homes that are offering to cover it or we can just negotiate it into the contract as it has always been. If they refuse to give any concessions on this in the contract (which is highly unlikely) then you have the choice to pay the buyer agency fee out of pocket or move on to another home that is offering it.
These changes will add a new layer of transparency and communication with all parties and I am happy to answer any questions you have about them! Just give me a call! 512-569-8480 or laurenclark@magnoliarealty.com
Steps to hiring me as your buyer’s agent:
- Phone call or in person meetup to see if you like me!
- Fill out buyer’s agency agreement detailing my fees, timeline, my fiduciary responsibilities to you and market area
- Set you up on a search for homes
- Tour homes
- Submit offers
- Close
- Live your amazing new life in the Hill Country!
I absolutely LOVE being a buyer’s agent and will always continue to offer these services to you! Read more about how I can provide value in representing you HERE!
