It's in the news! It's online! It's everywhere!

What is the change? Is is true that buyer commission is a thing of the past? What is really going on? Do I really have to sign an agreement before I can see a house?

Basics:

Buyer Agent Compensation cannot be advertised on the MLS. IDX Websites like Zillow, Realtor, Trulia etc get there information and photos directly from the MLS. This does not mean that Buyer Agent Compensation is a thing of the past. It means that the amount is no longer advertised - ON the MLS.

It CAN be advertised on the front of the house. It CAN be advertised on Facebook. It CAN be advertised anywhere and everwhere else, just not ON the MLS.

Buyer Agency:

A Buyer's Agent works for the BUYER and has the BUYER's fiduciary duty in their hands. If a BUYER's AGENT was not showing homes in the past based off of a low or no advertised BUYER's AGENT Compensation, did they truly have their clients fiduciary interests put first? This is what the lawsuit was about. They claimed that Buyer's Agents were steering their clients away from low commission listings. To deflect liabilty the NAR has now removed advertising of Buyer's Agent compensation from their system. They have also made a RULE not a LAW that to take a client to see a home that is listed on the MLS a Buyer's Agent and Buyer must be bound by a Buyer's Agency Agreement. This can be exclusive or non-exclusive but it must be in writing and dated prior to a showing. 

This agreement also shows how much compensation a Buyer's Agent is asking for. It has alway shown how much compensation a Buyer's Agent is asking for. It was reworded a little bit but is effectively the same. The difference now is that the RULE was made clear that to show a home an agreement must be in place. That is the change here.

How does Sean Smith Realtor view buyer agency?

When we have our consultation we will discuss the process of buying a home and set expections. When you choose to hire me to work for you in your home purchase journey we will sign an agreement that says I work for a 3% Buyer Agent Compensation plus a $250 brokerage free.

What happens if we go to a home and we fall in love and we make an offer and they are not offering a 3% buyer agent compensation? We make an addendum to the form matching my compensation request to their offered compensation. Done. And that $250 brokage fee? I pay that out of my compensation.

Your cost of hiring me to buy a house? Zero dollars and Zero cents.

Listing with Sean Smith:

Our Exclusive Right to Sell agreement has a section where commissions are outlined. I suggest 4% total commission. This is then distributed as 1% Listing Commission and 3% Buyer's Agent compensation. There is another $250 brokerage fee that again I pay from my compensation.

Why pay the buyer's agent more than myself? This fact seems to be forgotten. In any transaction the BUYER brings ALL of the MONEY to the TABLE. There is no transaction without a buyer. 

Please feel free to reach out with any questions. I look forward to helping you keep more money in your pocket when you sell your current home and I look forward to aiding you in negotiating a fair purchase on your next home.