Zillow Plunges After Verdict on Real Estate Brokerage Commissions

[GON]

So, here is a follow up to all those who thought real estate commissions would go down. They actually believed the media reports and in this thread as well as others I tried over and over to explain, nothing changes do to the OP "

"Zillow Plunges After Verdict on Real Estate Brokerage Commissions"​

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So here we are, real estate commissions have not changed and according to this have actually gone up slightly after the verdict against the National Association Of Realtors​

Dont say I told you so but I told you so. No agent has to work for free, the verdict against NAR has made it easier for experienced selling agents to make more money and higher commissions, not less. Maybe I somehow didnt make that clear in past posts but I went over it and over it.​

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All the grandstanding by politicians and people in forums who had no idea what they were talking about, well... anyway. ( I didnt mean to type all caps, but when I copied the OP post, it came all caps and I cant reduce it and my wife calling me for dinner*LOL*)​

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https://www.cnn.com/2025/02/17/economy/new-nar-rules-home-buying-update/index.html​

I found the lawsuit "wrong" and doubt it would have been litigated if massive fees to law firms were not bounty.

Our latest home purchase was an out of state home that I found on-line. I worked directly with the listing broker; I did not have a buyer's broker. There was competition for the home we purchased. The listing agent made six percent commission on the sale. With the new law, the listing broker would only have made three percent. The seller would have pocketed an extra three percent, but with a "hot market", I l doubt the seller would have given a better deal.

At three percent commission, the listing broker may not have been as motivated to work with us, as she had to do the sellers and buyers administrative work. At six percent, she is super happy to work/ represent both parties. This entire lawsuit made little sense except to enrich attorneys.

 

[Owen Lucas]

A real estate agent will help if you have trouble selling your home, but if it's a hot market or there is demand, you can DIY the whole operation for $1500 with an attorney and some minor effort i.e. answering the phone and opening a door.

 

[Tharber]

Typically listing agreements are written with a total commision to be paid. Then an amount is decided upon within that total that the listing broker will share if a buyers agent is involved. When there is no other agent, the total commission is still payable to the listing broker. All the new laws do is make a buyer have to pay the buyers agent out of pocket if the seller is not willing to pay tha fee.

 

[alarmguy]

Typically listing agreements are written with a total commision to be paid. Then an amount is decided upon within that total that the listing broker will share if a buyers agent is involved. When there is no other agent, the total commission is still payable to the listing broker. All the new laws do is make a buyer have to pay the buyers agent out of pocket if the seller is not willing to pay tha fee.

To put another way, the offer is presented by the buyers agent contingent on the seller willing to pay the buyers agent fee.
Most always do and if not, the buyers move onto another home, that is mostly rare depending not he market.
Even For Sale By Owners pay buyer agents fees most all times.

The markets I have been in, I never saw where a buyer paid an agent's fee.
When you think about it, the buyers always have and always will pay the listing and buyers agents fee's. As they are the ones bringing the money to the table is one way to look at it. Its part of the mortgage.

 

[alarmguy]

BTW- Realtor.com moving its headquarters out of California and to Texas

 

[Tharber]

To put another way, the offer is presented by the buyers agent contingent on the seller willing to pay the buyers agent fee.
Most always do and if not, the buyers move onto another home, that is mostly rare depending not he market.
Even For Sale By Owners pay buyer agents fees most all times.

The markets I have been in, I never saw where a buyer paid an agent's fee.
When you think about it, the buyers always have and always will pay the listing and buyers agents fee's. As they are the ones bringing the money to the table is one way to look at it. Its part of the mortgage.

Except that now per the DOJ, buyers agents must get a signed buyers broker agreement stating how they will be compensated. It also prevents a buyers agent from being double compensated incase the seller is also paying a fee. The kicker here is that some lenders will not pay this commission, so it comes out of buyers pockets. Its not that widespread but VA for example is limiting what they will pay towards buyer agent fees. Its pretty crazy how its been implemented. The intent was also misplaced. Politicians picked on an easy target to hide the fact that interest rates have skyrocketed. If you want to lower the cost of home ownership, get rid of title insurance. If the loans are federally backed anyway, why charge double? In commercial real estate, we have never guaranteed compensation, it must be asked for and it must be earned. If I am representing a buyer, I always have a buyers agreement signed so that there is no surprice as to what I am getting paid.

 

[alarmguy]

Except that now per the DOJ, buyers agents must get a signed buyers broker agreement stating how they will be compensated. It also prevents a ... If I am representing a buyer, I always have a buyers agreement signed so that there is no surprice as to what I am getting paid.

Exactly I think we are both talking doing things the right way as I ALWAYS have done. EVERYTHING was always a signed agreement. IN that agreement would be the sellers would have to pay my fee of XX% on behalf of my buyer clients if they accept our offer. As far as I know, this is still perfectly valid in NY and SC

Yes, I know, it's really impossible to talk real estate as each state has its own laws, rules. South Carolina at the time also was much like NY that I posted above.

I know you mention some lenders will not pay this fee. I am not understanding. I never saw a lender pay a fee. The fee is paid out of the seller proceeds in the two states I worked.

 

[Tharber]

Exactly I think we are both talking doing things the right way as I ALWAYS have done. EVERYTHING was always a signed agreement. IN that agreement would be the sellers would have to pay my fee of XX% on behalf of my buyer clients if they accept our offer. As far as I know, this is still perfectly valid in NY and SC

Yes, I know, it's really impossible to talk real estate as each state has its own laws, rules. South Carolina at the time also was much like NY that I posted above.

I know you mention some lenders will not pay this fee. I am not understanding. I never saw a lender pay a fee. The fee is paid out of the seller proceeds in the two states I worked.

Also new disclosures on closing statements have to line item out any fee's or commissions. It can be worked around by including them into buyers pre paids and closing costs but that seems to be over most agents heads now a days. Meaning, if seller agree's to contribute X% towards buyers clsoings costs and prepaids, its no issue but if its a line item stating buyers agent getting X%, lenders are baulking at paying that. There are sellers that will not pay that fee, no matter what.