Homes with Holly

Will Home Buyers REALLY Be Impacted By Potential Commission Change?

The real estate industry is no stranger to discussions about commissions, and one area that has seen significant proposed changes in recent times is buyer representation. Traditionally, real estate agents are compensated through commissions, which are typically paid by the seller. However, there has been a growing conversation about potential changes to how commissions are handled and will now be paid by home buyers. The big question is “will this really affect home buyers?” Short answer is- not if you have a great agent!

Shift Toward Buyer-Paid Commissions:

One of the recent proposed changes is a shift toward buyer-paid commissions. This would mean that instead of the seller being responsible for paying the buyer’s agent’s commission, the buyer would cover this cost. Even though this sounds like a bad thing, in reality there is no difference. The money for the agent commission is still coming from the proceeds of the house.

Lets break down how this affects buyers.

1. Cost Considerations: If the proposed changes lead to a shift toward buyer-paid commissions, home buyers would need to consider the additional cost of compensating their agents. An experienced real estate agent will educate home buyers on what an appropriate offer is so that they do not see a change in their buying experience.

2. Transparency and Awareness: Buyer-paid commissions could bring about greater transparency in the real estate transaction process. Home buyers would have a clearer understanding of the costs associated with their representation, potentially leading to more informed decision-making and a better grasp of the financial aspects of the transaction. However, shouldn’t agents already be doing this? I want to make sure my clients trust me and with trust comes transparency. They should never be blind to where the money goes.

3. Expectations of Service: With the potential shift toward buyer-paid commissions, home buyers might expect a higher level of service and dedication from their agents, given that they would be directly compensating them for their representation. Agents should already be giving their all when representing a buyer. The first thing I do when a client tells me they found a home and put in an offer, is contact the listing agent to set up a walk through. This way I can assess the house and educate my clients before they put an offer in. As opposed to many other agents that will blindly put in an offer for their clients because they can’t be bothered to go the extra mile.

4. Negotiation Dynamics: Changes to commission structures could introduce new negotiation dynamics into real estate transactions. Home buyers and sellers would need to navigate the implications of commission payment, potentially leading to additional considerations and negotiations as part of the transaction process. Again, an important job of your real estate agent is to help with negotiation.

5. Regulatory and Industry Impact: Any proposed commission changes would likely face regulatory and industry scrutiny. Home buyers would need to stay informed about potential regulatory developments and industry responses to ensure that they understand the implications of these changes on their home-buying experience. Your real estate agent should be on top of this for you and make you aware of anything that may affect you.

In conclusion, the proposed commission changes in buyer representation should have no impact on home buyers, IF they hire a reputable agent. As these changes continue to be discussed and evaluated, it’s important for home buyers to stay informed about the potential implications and to consider how these changes might influence their approach to purchasing a home. Contact me today and lets navigate the real estate market together!