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Well that is just the NWMLS which is an indie MLS. Most MLS's are REALTOR run and have to follow NAR rules. That said, I also belong to an indie MLS and you can offer any number greater than zero so a listing agent can offer $1 in my MLS if they want. I think the NWMLS has always been an amount greater than 0 too. Lowering the threshold by $1 isn't a game-changer. What is a game-changer is publishing the buyer agent compensation because now buyer agents will have to justify to buyers why they are worth that amount.
Where does this put buyers, who will perhaps have to pay their own fees (3%?!) out of pocket, on top of closing costs and down payment.
Where does this put the future of the Buyers Agent?
Well, it's too soon to tell for sure, but I think most listings will still offer to pay a buyer's agent fees, just like they always have, just like they often do with fsbos. I do hope most sellers will see the value in that.
If it has an effect, unfortunately, that effect will likely be on the representation and financing for the lowest priced homes, and least able to afford it.
In our own business, the source and percentage of our compensation has not been a secret before, so I'm not sure how it will change things to have it "published".
Will lenders finance the commission for those purchases where sellers will not pay and buyers would like to finance it with the purchase? That will be an important question, yet to be answered. I think I've heard the VA will NOT. If true, it's unfortunately going to be another strike against VA buyers, and that's too bad.
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Is this a Lending Tree-like Dumbing Down of an industry, wherein Lowest Buyers Fee wins?
It's all about price and negotiation.
So, the buyer's agent's fee is not baked into the price? Just another detail for the meeting of the minds.
Comps are generally based on sales with the Buyer paying their agent via a commission baked into the price.
Negotiate from that standpoint, and adjust for commission when doing comps.
It DOES have the plus of integrity, with the "Buyers Agency is FREEE" crowd having to own their BS.
It's all about price and negotiation.
So, the buyer's agent's fee is not baked into the price? Just another detail for the meeting of the minds.
Comps are generally based on sales with the Buyer paying their agent via a commission baked into the price.
Negotiate from that standpoint, and adjust for commission when doing comps.
It DOES have the plus of integrity, with the "Buyers Agency is FREEE" crowd having to own their BS.
The thing is... as Silverfall said... it's never been a *requirement* that the split be 50-50, or even, any minimum percentage. And yet, we have had a custom of 50-50 splits because that's what the listing agents told sellers is the norm for this area, and it is what agents have expected from each other.
Sellers so far have typically offered normal ranges of commission to buyers agents, even when choosing the cheap entry only listing services. So they've been more likely to want to lower their listing agent's commission than the buyer's agent. They evidently saw value in attracting buyer's agents.
I'm not sure what would change about that if the fee is published. What's not clear at all to me is how buyers are actually going to perceive those homes and those sellers who say they will pay nothing.
OK so from the Lending side, it seems the seller can still Elect to pay Buyer's fee, and allow it to be paid via seller concession, but they will likely be more judicious in regard to allowing that to cut into their net proceeds.
This also might move a good number of borrowers up the LTV scale.
Thanks for the perspective I had some peeps freaking out there...
OK so from the Lending side, it seems the seller can still Elect to pay Buyer's fee, and allow it to be paid via seller concession, but they will likely be more judicious in regard to allowing that to cut into their net proceeds.
Thanks for the perspective I had some peeps freaking out there...
They can, the change is that it is no longer required that they pay something, and the amount will now be published.
The thing is... as Silverfall said... it's never been a *requirement* that the split be 50-50, or even, any minimum percentage. And yet, we have had a custom of 50-50 splits because that's what the listing agents told sellers is the norm for this area, and it is what agents have expected from each other.
Sellers so far have typically offered normal ranges of commission to buyers agents, even when choosing the cheap entry only listing services. So they've been more likely to want to lower their listing agent's commission than the buyer's agent. They evidently saw value in attracting buyer's agents.
I'm not sure what would change about that if the fee is published. What's not clear at all to me is how buyers are actually going to perceive those homes and those sellers who say they will pay nothing.
Too soon to tell.
The "custom" is immaterial in regards to the concept that including a buyers' agency commission baked into the price is optional.
Yes, the agent may have more pressure on them to provide good discussion of their value proposition, but that is a plus.
Other than publishing the buyer's agent commission on the public MLS it doesn't appear to be any different than how my MLS is run now. Sellers have always had the power to refuse to pay anything more than $1 to the buyer's agent.
My last sale the buyers agent took no commission per the settlement sheet. No the buyer was not related to their agent AFAIK. Not sure but I think it was a gift hoping to get listings of more valuable family property related to buyer.
My thoughts on WA change: in the beginning the seller will have at least a 3% advantage in their listing price being 3% lower. But will buyers agents show their home? It will be essentially a FSBO where the owner has agreed to pay 3% to listing agent and nothing to a buyers agent.
It seems wrong-headed. A seller WANTS buyers agents. They are more valuable than the listing agent when push comes to shove (and hope that doesn't happen lol). They bring money along with their commission cost.
I would like to change the current system but not my job. Both buyers and sellers lose in the current system, both overpay commission IMO.
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