Last month, the National Association of Realtors ("NAR") announced a nationwide settlement that would resolve claims initiated by a group of home sellers in Missouri. The case, which is currently on appeal, alleged that several brokerages in Missouri conspired, along with NAR, to artificially set commission rates. While NAR has maintained that commission rates are, and have always been, negotiable, they elected to settle the case. As part of the settlement there are two provisions that apply to the real estate industry across the country, including buyers and sellers in South Carolina.
The first change is that, starting July 15, 2024, "offers of compensation" can no longer be shared through the multiple listing service (MLS). The only impact of this change is that a buyer's agent can no longer clearly see what a listing broker is offering as cooperative compensation.
That said, while it can no longer be shared through MLS, cooperative compensation, where the compensation a seller pays to their listing broker is shared to cover the cost of the buyer's agent, will continue to be an important option for most. This is especially true for lower and middle-income homebuyers who already have a difficult-enough time saving for a down payment.
To be clear, nothing in the settlement limits a seller's ability to pay a buyer's agent. A seller can still offer cooperative compensation, it just cannot be offered through the MLS. As an alternative, a seller may offer through MLS a concession towards a buyer's closing costs, which could then be used by the buyer to compensate their own agent.
The second change is that agents will now be required to enter into a written agreement with their buyers which outlines both the duties of a buyer's agent as well as how buyer's agents are compensated.
While this will be a new requirement for many across the country, buyer's agency agreements are already required in South Carolina and have been for many years.
Real Estate agents are critical to the buying and selling process, helping their clients navigate what is likely the most significant financial transaction of their lives.
In fact, over 90% of homebuyers have historically opted to work with a real estate agent. At the end of the day, the changes implemented as part of NAR's settlement will not change a real estate agent's value to their clients: expertise, diligence, and a commitment to their clients' best interests.
Agents know the local market and neighborhoods, providing access to extensive information about available homes, offering insights into property values, taxes, regulations, and zoning laws.
Agents help prospective buyers determine realistic budgets and research varied financing options. Agents are skilled in pricing and negotiation, helping sellers' price their home based on where the market is going, not where it has been, and guiding clients to submit competitive and realistic offers.
Agents connect buyers and sellers with other reputable real estate-related professionals such as lawyers, lenders, contractors, and home inspectors, any one of which can make or break a transaction. Agents are even crucial advisors for their clients after closing, providing ongoing support, answering questions, and offering guidance.
Carolina One Real Estate has served the local community for over 60 years, through every type of market and throughout the continual evolution of the real estate industry. Our agents have the expertise, support, and resources to help you navigate the market and achieve your individual real estate goals.
