Navigating Major Shifts in Real Estate: How to Prepare for Changing Buyer Commissions!

There are some significant changes happening in the real estate industry:

If you've been following the Zillow lawsuit, you might know that recently, two major players, Realogy (which includes Coldwell Banker, Century 21, and Sotheby's) and RE/MAX, settled this lawsuit. While other companies and the National Association of REALTORS are still part of this ongoing lawsuit, these two giants settled for substantial amounts—Realogy for 85 million and RE/MAX for over 55 million.

But what's more crucial is what they agreed to within the settlement itself, not just the financial aspect:

They've agreed to give sellers the option to not pay buyer agent commissions (BAC) when listing their homes. This means that when a property is listed on the MLS, sellers can choose to set the buyer agent commission to zero.

Imagine this scenario:

In your market, a significant portion of sellers start opting not to pay a buyer agent commission. It's a game-changer, and we need to adapt to it. What this will force us to do on the buyer's side of the transaction is to begin collecting fees from buyers. This practice has been relatively rare nationwide. While some agents have done it, it hasn't been the standard.

However, we're entering a period where we may have to treat buyers more like we treat sellers.

When we interact with sellers, we conduct a seller presentation, discuss our value, and have them sign documents indicating they'll pay us if their house sells. Now, picture applying a similar approach to buyers, which we may be compelled to do.

We'd sit down with a buyer and say, "Let me take a few minutes to show you how I work. Let's walk through the process of my representation and the value I provide. If I successfully help you buy a home, you'll pay a fee." This fee might be offset if the seller pays us through the commission, but in many future cases, buyers may be writing the full check.

The market is evolving, so what can you do to prepare? I'll give you three essential steps you can take right now to get ready for these likely changes coming to markets across the country.

1. Create a buyer presentation that highlights the value you bring to buyers.
2. Familiarize yourself with the buyer representation agreement forms specific to your area.
3. Practice your scripting and role-play these conversations to become comfortable and confident when presenting the buyer presentation and related documents, just as you do with sellers.

These steps will help you stay ahead of the curve and navigate the evolving real estate landscape effectively.

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+ 32 Years of Real Estate Sales, Management, and Coaching Experience
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+ His Current Team Closed $1.4 Billion in Sales in One Year
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