Adapting to Change: How Real Estate Agents Must Evolve Their Approach
Download MP3 Potential Impact of Lawsuit on Real Estate Commissions:
- If you're a potential home buyer, this case may benefit you in the long run.
- The National Association of Realtors has historically influenced commission prices, making it difficult for buyers to be their own agents.
- Buyers typically had to either negotiate with the seller's agent (who often had a 6% commission) or hire a buyer's agent to split the commission.
How the Lawsuit Could Change Things:
- A recent lawsuit in Arizona or New Mexico, along with a similar case in Chicago, could change the way real estate transactions are done.
- If the lawsuit succeeds, buyers may be able to negotiate directly with the seller’s agent, potentially saving money on commissions.
Impact on Buyers:
- If buyers work directly with the seller’s agent, they may be able to negotiate a lower commission rate, which could lead to a reduced price for the house.
- Real estate commissions could decrease, potentially lowering the cost of buying a home in the future.
Why Commissions Have Been Rising:
- Higher real estate commissions have been a result of increasing home prices.
- For example, with a median home price of $180,000, 3% commission would be around $5,000, while with a $400,000 home, the commission is $12,000.
- Despite the higher commissions, it hasn’t necessarily become harder to sell a home; in fact, it might be easier due to high demand and fewer listings.
Efficiency in the System:
- While real estate agents work hard, this lawsuit may highlight inefficiencies in the system.
- The outcome of the case could make the home buying process simpler and possibly cheaper in the future.
