Latest Posts:
Tag

buying

Browsing
In News

The rules of buying and selling a home in California have totally changed after historic

No Comments


A “Sale Pending” sign hangs in front of a property in San Francisco in 2023. Last Saturday, the National Association of Realtors introduced policies that changed the payment process for real estate agents representing home buyers. 

Jeff Chiu/Associated Press

There’s been a major shake-up in how you buy and sell your home in America — and those in the Bay Area’s ultra-pricey and ultracompetitive housing market are watching closely to see how these changes might affect them.

This past Saturday, the National Association of Realtors implemented new policies that affect how real estate agents get paid when they represent a home buyer.

Article continues below this ad

Previously, in the vast majority of real estate transactions, the seller covered the commission fees for both the seller’s agent and the buyer’s agent. That commission percentage was baked into the price of the house. When homes were listed on the real estate database called the Multiple Listing Service, agents could see what percentage commission they would get if someone they represented bought the home.

For the buyer, their real estate agent’s services were “free,” in that they did not pay the agent out of pocket during the transaction.

A lawsuit upended this longtime practice. A group of home sellers in Missouri argued in a class action lawsuit that the practice violated antitrust laws. So the National Association of Realtors, a trade association that represents real estate agents and brokers, agreed to a settlement that changed the rules.

Those changes represent “the biggest shake-up to real estate in the United States in the past 200 years,” said Nikki Edwards, a real estate agent in the Bay Area. 

But in Northern California’s tight markets, she said she doesn’t see the changes “being a factor that’s going to move the needle in terms of dropping prices dramatically to even affordable levels.”

Article continues below this ad

If you’re planning to buy or sell a home in the near future, the process is going to be different. Here’s what to expect.

Changes for buyers

How it worked before: A real estate agent could show a potential buyer a house without establishing any sort of contract between the parties. Buyers had no say in what commission the agent would receive if they bought a house. 

Though the buyer’s agent was not working “for free,” said Vanessa Gamp, the president of the San Francisco Association of Realtors, “the buyer was not paying up front for the services. The agent was being paid through the shared listing agents’ commission” via the seller from the proceeds from the home sale.

How it works now: A buyer will need to enter into a written agreement stating how their real estate agent will get paid before the agent can show them a house. 

Article continues below this ad

Vince Malta, the former president of the National Association of Realtors and a real estate agent in San Francisco, outlined what the agreement must contain.

“The relationship and how compensation is going to be paid, how the agent will be compensated, what the rate will be — is it a fee, a percentage, something else — and it will include a statement that the agent will not receive compensation from any source other than what they’ve agreed to in this written agreement,” Malta said. The agent and buyer will also agree on the duration of the contract. It could be for a few months or longer, or it could just cover one house showing.

So buyers now have the opportunity to decide what they think their agent’s time is worth. Buyers can negotiate the traditional percentage commission on the purchase price or negotiate a flat fee, an hourly rate or some other arrangement. The realtor can agree to that or not.

This change doesn’t necessarily mean buyers will have to pay their agent’s fees out of pocket and up front — or at all. Sellers are still allowed to fold the buyer’s agent’s commission into the purchase price. They just aren’t agreeing to do that up front like they used to.

It’s too early to tell whether nontraditional payment arrangements will become popular: The rules only went into effect this past Saturday. So far, Gamp said, she hasn’t been approached by any buyers seeking an alternative style of payment. And none of the real estate agents interviewed for this story said they’ve heard from sellers who say they won’t agree to the traditional method of baking the commission into the sale price.

Article continues below this ad

So-called discount agents already exist — websites and platforms that will draw up an offer letter for a flat fee — and they might become more popular, Gamp said. But a competitive real estate agent who can pick and choose clients probably won’t take one trying to get a bargain.

“San Francisco’s a really sophisticated, complicated market. And most agents that are out here selling real estate for a living are putting in a ton of time and effort,” she said. “In order to be successful, you’re typically working with an agent that does this full time, and those agents want to be paid appropriately for the work that they’re doing.”

Changes for sellers

How it worked before: In most cases, the seller agreed to pay their agent and the buyer’s agent before the house was listed on MLS. That agreement often involved a cooperating commission amount based on the purchase price of the house — typically 5%-6%, though that percentage was always negotiable — and split between the two agents. That commission was listed on MLS, so other real estate agents could anticipate what they’d make on a sale.

How it works now: The seller is not required to agree up front to cover the buyer’s agent costs. Any commission that might be offered to a buyer’s agent will not be listed on MLS.

Article continues below this ad

Buyers will have the option to make an offer that includes a percentage they intend for the seller to pay as commission to their agent. A seller can agree to that — and has good incentive to, Gamp said. Limiting your potential buyer pool to people who can pay their agent out of pocket in addition to their down payment means you might get fewer offers or fewer competitive ones, especially in a market like San Francisco that’s already so pricey.

“A buyer is going to have a finite budget no matter what,” Gamp said. “So if they are also required to pay commission, that means they will have less of a budget for the purchase.”

What about open houses?

The new policy change doesn’t extend to open houses. You can still casually drop in to one without having to sign a contract under the new NAR rules. A listing agent might ask you to sign something before you see an open house. But they are not required to under the NAR settlement rules.

“That is the one carve-out the NAR made very clear,” Gamp said. There was some confusion about this at first, she said, but “public open houses is the one scenario where a buyer would not need to have a signed agreement in order to see the property.”

Will this change bring down home prices?

When the settlement was announced, some industry watchers predicted it would bring down prices by putting buyers in the driver’s seat when it comes to how their agents were compensated. Buyers could negotiate a flat fee or lower percentage payout. Or the changes could reduce competition for homes by removing casual shoppers from the market who are wary of signing a binding agreement up front.

But buyers have very little leverage to begin with in California’s super tight market, and they have lots of competition. Malta said he doesn’t see these changes moving the needle.

“I think it’s really speculative to say this is going to affect home prices,” he said. “There are greater market conditions such as inventory and mortgage interest rates that are much bigger factors.”

If anything, it could make things harder for buyers, Edwards said.

“If you’re placing an offer, and if now we’re competing with other people and we don’t know what they’re offering in terms of commission now, we don’t really know how that seller’s going to look at the offers,” she said. 

Ultimately, buyers will have more transparency into pricing with their agent. But the changes add a layer of paperwork and complexity to a process that was already notorious for both of those things.

Reach Jessica Roy: jessica.roy@sfchronicle.com



This article was originally published by a www.sfchronicle.com . Read the Original article here. .

Read More
By
In Home Improvement

How to choose a Dining table: Ultimate Dining Table Buying Guide

No Comments



The best material for your dining table depends on how you will be using it and how much maintenance you want to do. Below are some pros and cons of popular materials.

Popular Wood Types

Walnut. A classic hardwood renowned for its rich color, density, and durability, making it ideal for daily use. However, it can be expensive.

Oak. One of the most popular types of wood for tables due to its durability, family-friendliness, minimal maintenance, and lower cost than some other wood types.

Acacia. Known for its beautiful grain, acacia is highly durable and suitable for heavy use. Maintenance involves simple cleaning and occasional oiling. 

Mahogany. Rich, elegant, and timeless mahogany dining tables are frequently found in traditional dining rooms. Mahogany has fewer knots than other types of wood, creating a smoother appearance. However, it is more expensive.

Mango. Mango wood requires only simple cleaning because of its sustainability and unique grain patterns. However, it is less durable than other woods and not ideal for daily use.

Rubberwood. Rubberwood is durable enough for daily table use when treated as a medium-density light-colored hardwood that is considered cost-effective and environmentally friendly when properly harvested. However, treatment often involves chemicals, and rubberwood may trigger latex allergies in some people.

Other Popular Dining Table Materials

Marble. Elegant marble is one of the most popular dining table materials. As a stone, it is highly durable overall. However, marble is heavy and expensive and can stain easily, chip, or crack.

Metal. Metal is one of the most practical dining table materials, given its durability and low maintenance, and it can fit any design style. For example, dark and distressed metal finishes suit the industrial style, polished finishes suit the contemporary style, and dark and smooth metals suit the traditional style. 

Glass. Tempered glass tables resist breakage, keep sightlines open, and fit a range of styles. However, glass tends to show fingerprints readily.

Stone. Every type of stone is unique, and it can last a lifetime. However, it is more expensive and heavier, than many other materials, and can be fragile, so ensure the appropriate room and care when selecting this type of material. Use only suitable for natural stone cleaners.

Best Materials forEasy maintenance: Metal and most hardwoods.A luxury look: Marble, granite, and other stones; mahogany, ebony, cherry, and walnut woods.Longevity: Metal, hardwood, stone, cement.



This article was originally published by a www.houzz.com . Read the Original article here. .

Read More
By
In News

Changes in real estate agent pay impact home buying and selling

No Comments


New changes in real estate transactions are altering how agents are paid, impacting both buyers and sellers.When your real estate agent lists your home, the commission is no longer included in the Multiple Listing Service (MLS), the database agents share. Commissions still exist and are negotiable. Sellers can still offer to pay buyer fees, just as they might cover the cost of a home warranty or other expenses.”It’s definitely made agent pay a bigger part of the conversation,” said Krishon Harris, a real estate agent for Reece & Nichols.Agents say high interest rates are keeping homes on the market longer, for 30 to 40 days in some cases.”It is in the offer acceptance process when buyers will find out how much they owe their agent,” Harris said.Sellers can still offer to pay buyer fees, just as they might cover the cost of a home warranty or other expenses.”As a buyer, your biggest change is that you have to have a written agreement with an agent before you go see a house,” Harris said.He says when and how fees are discussed is the biggest change.”When you are a buyer and you make an offer on a house, you’ll include in the offer what you’re asking the seller to pay your agent,” Harris said. “The seller can agree to that. They can counter, reject it, or whatever.”

New changes in real estate transactions are altering how agents are paid, impacting both buyers and sellers.

When your real estate agent lists your home, the commission is no longer included in the Multiple Listing Service (MLS), the database agents share. Commissions still exist and are negotiable. Sellers can still offer to pay buyer fees, just as they might cover the cost of a home warranty or other expenses.

“It’s definitely made agent pay a bigger part of the conversation,” said Krishon Harris, a real estate agent for Reece & Nichols.

Agents say high interest rates are keeping homes on the market longer, for 30 to 40 days in some cases.

“It is in the offer acceptance process when buyers will find out how much they owe their agent,” Harris said.

Sellers can still offer to pay buyer fees, just as they might cover the cost of a home warranty or other expenses.

“As a buyer, your biggest change is that you have to have a written agreement with an agent before you go see a house,” Harris said.

He says when and how fees are discussed is the biggest change.

“When you are a buyer and you make an offer on a house, you’ll include in the offer what you’re asking the seller to pay your agent,” Harris said. “The seller can agree to that. They can counter, reject it, or whatever.”



This article was originally published by a www.kmbc.com . Read the Original article here. .

Read More
By
In News

Rules for buying and selling a home are changing. Here’s what to know.

No Comments


When it comes to buying and selling homes, new rules are about to be put in play, five months after the National Association of Realtors agreed to a blockbuster settlement over how its 1.5 million agents across the U.S. are paid commissions.

The settlement — which resolved litigation stemming from a grand jury finding that the real estate group artificially inflated brokerage commissions — brings sweeping changes to the industry, starting tomorrow.

The adjustments come as prospects brighten for the beleaguered housing market. Mortgage rates earlier this month tumbled to their lowest level since April 2023, offering hope to house hunters priced out of the market given high borrowing costs and home prices that reached a record in June. 

Still, the current rate on the 30-year fixed loan stands at about 6.5%, or more than double the sub-3% rates available in 2020 and 2021. The Federal Reserve in September is widely expected to reduce its benchmark interest rate, a step that should reduce mortgage rates currently high enough to bring turnover in the housing market near 40-year lows. 

In the meantime, real estate agents across the nation will have to adopt to new changes that could potentially reduce the commission that home sellers are asked to pay. 

Many experts are now looking for home prices to fall as the sticker price will no longer include the steep commissions that have for decades been in play.

Here’s a rundown of what this means for those looking to buy and sell homes going forward.

Buyers beware

Real estate agents are now required to have buyers sign a form before showing them a home. The agreements are intended to detail exactly how much a buyer will be expected to pay an agent. 

However, “at that stage, the buyer hasn’t had an adequate opportunity to evaluate that agent,” Steve Brobeck, a senior fellow at the Consumer Federation of America, told CBS MoneyWatch. “When you’re touring houses with an agent, the agent is auditioning to be your agent, that’s when you get to know the agent.”

Most buyers would not be comfortable signing a contract with a financial obligation that early in the process, added Brobeck, who noted that the new requirement came at the industry’s behest and was not part of the NAR’s settlement.

Buyers should not sign a contract with a financial obligation until they are ready to make an offer, advises Brobeck. “There are other options for seeing a house,” he noted, including calling the listing agent or attending an open house. 

Another option that is increasingly in use are touring agreements that cover limited amounts of time and come without financial ties, he said, noting that Zillow had developed one. Many model contracts developed by the industry are difficult to read, understand and are otherwise problematic for consumers, Brobeck warns. 

That said, one buyer-broker agreement developed by real estate brokerage eXp Realty is “simple, consumer-centric and meets most of our criteria,” he said. “They’ve made it available for the industry to use.”

Homebuyers should also think about offering a flat fee or paying their agent an hourly rate, the advocacy group advised.

“The dollar value of today’s percentage commissions is often underestimated by buyers. Moreover, buyer agents should not have a financial incentive to be paid more the higher the sale price,” Brobeck said in a report.

Sellers rejoice?

For folks selling their homes, the changing landscape should bring some quick respite, as their agents no longer have to make an offer of commission to buyers’ agents. 

Nearly 9 in 10 home sales are handled by real estate agents affiliated with the NAR, the nation’s biggest trade association. It required that home sellers figure in a commission rate, usually 6%, before listing homes on its property database, known as the Multiple Listing Service, or MLS.

The commission borne by home sellers was then divided between agents for the seller and buyer. While on paper subject to negotiation, the fee was the focal point of the lawsuit lost by the NAR and brought by a group of home sellers, who claimed the trade group and others colluded in driving up the commissions.

In June, the median sale price of a home was $442,451, according to Redfin. Under the previous practices sellers would be paying $26,547 in commissions. That customary rate is no longer the default.

Sellers can now expect to be asked for just one side of the commission pot, or what would now average 2.5% to 3%. 

“For the first time now, buyers will have the opportunity to negotiate the buyer commission,” said the CFA’s Brobeck. “We suggest setting a target of 2% or less,” the advocate said. Matched with the buyer agent’s commission that would mean paying overall commission closer to 4% rather than the current standard of 5% to 6%, he added.

In a separate but related development, almost any American who sold a home in the last fives years is covered by the class-action settlement with NAR and other brokerages. How much anyone is entitled to depends in part on how many sellers submit claims, and other factors including where one lives and when your home was listed. 

To see if you’re eligible, check here. 

More from CBS News

Kate Gibson

Kate Gibson is a reporter for CBS MoneyWatch in New York, where she covers business and consumer finance.



This article was originally published by a www.cbsnews.com . Read the Original article here. .

Read More
By
In News

Realtors’ new rules take effect Saturday. How buying, selling a home might be affected

No Comments


Chicago members of the National Association of Realtors say they’re prepared for the changes that some housing experts describe as the industry’s largest shift in how homes are bought and sold.

NAR, a professional organization of real estate agents whose members are known as Realtors, will be implementing two major changes starting Saturday as part of a $418 million antitrust settlement.

The changes upend more than a decade of industry procedures and could affect how buyer agents have traditionally been paid. It could also open up more opportunities for homebuyers and sellers.

“What we’re really going through is a seismic shift,” said Matt Silver, a partner and senior broker in Corcoran Urban Real Estate.

The NAR doesn’t expect home prices or sales to fall but says the changes could make it harder for first-time homebuyers in a frenzied real estate market.

What’s the biggest change?

Offers of broker compensation no longer will be displayed on the Multiple Listing Service, a database used by licensed brokers and agents to share information about properties for sale as well as commissions.

Historically, broker commissions have been paid by sellers. Seller’s agents usually agree to split their commission with the buyer’s agent. That means homebuyers often don’t incur an extra cost when working with a real estate agent — a big relief for first-time buyers — as their agent’s commission is covered by the seller.

Commissions typically range from 5% to 6%.

Compensation offers will still be an option consumers can pursue off MLS through negotiation and consultation with real estate professionals, according to NAR, which says broker commissions have always been negotiable.

How agents are compensated is “the biggest change our industry has had to deal with in easily 100 years,” according to Laura Ellis, Baird & Warner’s chief strategy officer, executive vice president and president of residential sales, who has been with the firm since 1998.

Ellis said the change will create more conversations between real estate agents and clients, requiring agents to use different skills than they might be used to.

Laura Ellis of Baird & Warner at the company’s Gold Coast office.

Barry Brecheisen/For the Sun-Times

“We did a big push on educating our agents about the fact that most buyers thought that the process or the service to them was free because … the seller technically paid the commission,” Ellis said. “Transparency in that alone is a big difference.”

Many real estate agents have been letting clients know in advance about the changes. And trade groups have been sharing updates for months with their members ahead of Saturday’s deadline.

Why is this happening now?

The changes stem from a series of class-action lawsuits filed by homeowners, who accused the NAR of fixing broker commissions at high rates and discouraging sellers from seeking better terms. The association has 1.5 million members and broad control over access to the MLS system.

The NAR agreed to settle the lawsuit in March., ending litigation that could have resulted in a $1.8 billion verdict against the association and tripled under antitrust law.

In April, a federal judge in Missouri granted preliminary approval to the settlement. A final approval hearing is scheduled in November.

The NAR has denied any wrongdoing.

Are other changes coming?

The settlement also requires all real estate agents working with a buyer to enter a written agreement outlining compensation before touring homes.

Some Chicago real estate agents say the written agreement requires less of an adjustment for them because they already use buyer-broker agreements.

Erika Villegas, a real estate agent for more than 20 years, said she’s always used buyer-broker agreements even though her firm, Oak Park’s RE/MAX In the Village, never required them. Villegas said requiring the document industrywide will be beneficial.

“I think it’s a great opportunity for us to make sure that we are providing the best tools, best services and we [are] making it very clear and transparent of the work that we do for buyers,” Villegas said.

Illinois real estate laws will change in 2025, including the requirement for written brokerage agreements.

What this means for you and the industry

While broker compensation no longer will be displayed on the MLS, Ellis doesn’t expect a change in how brokers are compensated. She predicts buyers will ask sellers for a “closing cost credit,” which buyers then use to pay their agent. Homebuyers also can ask the seller to pay their broker — reverting to the traditional model.

Both those scenarios emphasize that the buyer commission comes from the home transaction, Ellis said.

“It doesn’t mean that [buyers] are going to have to come out of pocket with money that they never did before,” she said.

Buyers and sellers also could elect to separately pay their own broker, raising concern among some real estate agents about how the rules could affect first-time buyers.

How will first-time buyers be affected?

First-time buyers, including those from underrepresented groups, can have trouble with financing their first home and having to pay a broker’s commission could act as an extra hurdle, according to Brian Kwilosz of EXIT Realty. Kwilosz said EXIT is watching the impact the changes will have on first-time buyers.

Lutalo McGee, owner of the real estate firm Ani World, plans to stress that cooperative compensation remains an option for new buyers even if it’s negotiated differently. Ani Real Estate, under the umbrella of McGee’s Ani World, has the bulk of its sales on the South Side.

“A lot of clients, at least that I service and my brokers [service], are those that have struggled with down payments and closing costs in the past,” McGee said. “We’re going to be actively monitoring to see what the impact of these changes are going to be.”

Several real estate agents said they don’t think the changes will affect home prices. The housing market is driven by supply and demand, Silver said, and with a dearth of housing across the region, he doesn’t think home prices will go down “anytime soon.”

It’s possible buyer commission rates could drop as agents and their clients have more conversations about compensation. But Ellis predicts agents will complete more transactions after Saturday’s changes take effect.

“I think that good real estate agents will actually increase their income,” Ellis said. “We’ve got to do what’s right for the consumer and what they want and bring real, tangible value to them.”





This article was originally published by a chicago.suntimes.com . Read the Original article here. .

Read More
By
In News

How new real estate rules are set to reshape home buying and selling across the U.S.

No Comments


How new real estate rules are set to reshape home buying and selling across the U.S. – CBS News

Watch CBS News

Starting Aug. 17, new regulations will change how real estate commissions are handled, potentially lowering costs for homebuyers and sellers. Under the new rules, buyers and sellers will have the opportunity to negotiate commissions directly with their agents, a shift that could impact everyone involved in the real estate market.

Be the first to know

Get browser notifications for breaking news, live events, and exclusive reporting.

Not Now
Turn On



This article was originally published by a www.cbsnews.com . Read the Original article here. .

Read More
By
In News

New rules for buying, selling homes take effect Saturday after lawsuits

No Comments


First, before a seller may show a residential property or a buyer may tour a property, real estate professionals and their clients will be required to enter into a written representation agreement outlining the terms of realtors’ compensation, said Ali Whitley, president of Ohio Realtors.

This story is free

We’ve opened this story as free to help you experience the important and entertaining journalism we’re producing. Here are some ways you can follow our work:

Written representation agreements must include an expiration date, information on fair housing and blockbusting laws, whether the relationship is exclusive or nonexclusive, and terms of compensation, according to House Bill 466, which was recently approved in addition to the settlement agreement.

ExploreNumber of homes sold, sale prices kept rising in first half of 2024

Stephen Brobeck, a senior fellow with Consumer Federation of America, told this news outlet that the lawsuit and resulting ruling is based on the fact that for the last century, the real estate industry has effectively set commission rates.

“DOJ (the Department of Justice) has been working for 80 years to try to force the industry to create a more price-competitive market … but the real watershed was the jury decision in the combined Sitzer and Moehrl cases,” he said. “A jury found the the industry defendants guilty of price fixing and awarded the Missouri plaintiffs over $5 billion including triple damages.”

For decades, real estate agents have typically been paid a certain percentage of the sales price once the home is sold. A typical agent’s commission has been 6% of the sale price, split between the agents or companies representing the buyer and seller.

Brobeck said in the new system, it is important for people who intend to buy or sell a home to carefully select an agent ahead of time who is both honest and competent. Before deciding on an agent, the buyers and sellers should get a proposed contract document from the agent and have an opportunity to read and understand it. He said the agent should be willing to discuss the contract before the buyer or seller selects them.

“If an agent will not present a readable contract that is consumer-centric, a consumer should look for another agent,” Brobeck said. “And it’s that refusal by consumers to work with agents presenting unreadable contracts that will persuade the industry to improve them.”

Second change: Compensation

Real estate professionals will be prohibited from offering cooperative compensation on listings on multiple listing service (MLS) databases, Whitley said. That includes all listing types that appear on the MLS, including residential, commercial and rentals.

“What that means is that if the buyer’s broker is authorized by the buyer to accept commission compensation from a different party than the buyer, then they’ll need to just get that communication directly from the listing agent or the seller,” Whitley said. “What a buyer should expect moving forward is that we have a written representation agreement that will delineate what the services of their broker or agent is to them, and the fee for those services. So prior to showing any homes or to touring any homes, they will have a written representation agreement with their agent.”

Buyers and sellers can still negotiate compensation arrangements directly with real estate professionals outside of the MLS. Additionally, sellers may continue to offer buyer concessions, such as closing cost contributions on the MLS.

Whitley said the changes are meant to be transparent and provide clarity to both the sellers and buyers in the transaction.

“Instead of there being a perceived situation of a listing broker determining what will happen moving forward with a buyer’s broker, it will be very clear that it is the seller and the agent are having a conversation and determining that the seller is or is not willing to offer cooperative compensation,” she said. “And if they are willing to offer cooperative compensation, what is that amount that they are wiling to offer.”

ExploreOwners of Pet Wants business plan to open downtown Miamisburg storefront

On the buyer’s side “it’s clarifying that the buyer’s agent provides services to the buyer … and they advocate on behalf of the buyer,” Whitley said. “And so the written representation agreement will delineate what those services are, and then also what the fee is that that broker is charging for those services. And then the buyer and the buyer’s broker will be able to negotiate from there what that commission is that will be paid and how it will be paid.”

Whitley said the compensation obligation can be satisfied through the purchase agreement, if the seller is willing to offer it.

“It also can be negotiated between buyer and seller during the time of a purchase agreement, or the buyer could say ‘I prefer to pay my own agent because they are working on my behalf … or any combination of those things can happen,” she said.

Kelly McCormick, president of Dayton Realtors, said commissions were “always negotiable.”

“Now, creating that clarity between buyers and sellers is something that the real estate industry and agents will be doing every single day,” McCormick said. “There’s always going to be a cost to sell and a cost to buy. Those costs are always provided, as far as a lender of good faith estimate, and now both buyer and seller will have potentially more clarity in how that cost impacts their purchase and their sale.”

ExploreBig Lots to close 315 stores, including sites in Montgomery, Butler counties

Austin Castro, a team leader at Coldwell Banker Heritage, said part of the impact from the changes could come as a result of people signing agreements with buyers agents up front, as opposed to down the road.

“What I think that means is when someone wants to sell their house, there was always a big interview process?” he said. “They’d call three or four different agents. They’d sit down and interview them. They’d talk about it, you know, and then they sign an agreement to sell their house with whoever they thought was best fit for the job. I think we’re going to start to see that now with with buyer’s representation.”

Castro said buyers, when choosing an agent, used to go with the first person they met, someone they met at an open house or a friend of a friend.

“Now I think it’s going to be a little bit more of a interview process for buyers representation because people are signing those agreements up front, disclosing ‘Hey, this is what my agent makes on this transaction,’ so I think that’s probably where we’re going to see a biggest change is going to be maybe buyers putting a little more thought on who they’re going to have represent them,” Castro said.

ExploreFuyao raid: Who owns raided properties and what neighbors have seen





This article was originally published by a www.daytondailynews.com . Read the Original article here. .

Read More
By
In News

New real estate commission rules to roll out Aug.17: Here’s how selling and buying a home

No Comments


New rules to how homes are bought and sold could mean an average savings of more than $50,000 to Peninsula home sellers. Photo courtesy Getty Images.

Big changes are coming to how homes are bought and sold beginning Aug. 17 when new rules roll out that will revamp how Realtors get paid commission. 

The changes, which are part of a $418 million court settlement that the trade group the National Association of Realtors announced in March, put an end to the decades-old practice requiring home sellers to pay 5% to 6% of a home’s purchase price to cover the commission for both the listing agent and the buyer’s agent.

For sellers on the Midpeninsula, where the median price for a single-family home is above $2 million – this means an average savings of more than $50,000 in commission fees.

The sudden death of the 6% commission

The Sitzer/Burnett buyer-broker commission lawsuit – a class-action lawsuit filed in Kansas City, Mo., last October on behalf of 260,000 home sellers in the Midwest over the National Association of Realtors’ commission rules – paved the way for the new regulations that will affect sellers, buyers and agents nationwide. 

A federal jury found the National Association of Realtors and some residential brokerages liable for nearly $1.8 billion in damages after determining they conspired to inflate commissions by forcing sellers to make non-negotiable offers of compensation to the buyer’s agent for listings on the Multiple Listing Service. 

What buyers should know

If you are a buyer and your agent is using an Multiple Listing Service, you will need to sign a written agreement with your agent before touring a home so you understand exactly what services will be provided and for how much. Written agreements are required for both in-person and live virtual home tours and must include: 

The amount of compensation the real estate agent will receive and how this amount will be determined. Is it a flat fee, a percent of the home cost or an hourly rate?  Compensation cannot be open-ended or determined by “whatever commission amount” the seller is offering to give to the buyer’s agent. 

A statement indicating that the agent is prohibited from receiving compensation for brokerage services from any source that exceeds the amount or rate agreed to in the agreement with the buyer

A statement indicating that broker fees and commissions are fully negotiable and not set by law. 

Information from the National Association of Realtors.

To resolve the litigation claims against the trade association and more than one million Realtor members, the National Association of Realtors agreed to make changes to its commission process as part of the $418 million settlement agreement.

The association, however, has stressed that commissions have always been negotiable and continues to deny any wrongdoing by its members in regard to commissions. 

“NAR does not dictate commissions. This was true before the settlement agreement and remains true once the practice changes go into effect,” according to a statement by the association.  

What the changes mean to buyers and sellers

Under the new system, the most significant change is how buyers’ agents are paid. While the seller can choose to pay a buyer’s agent, the rules make it crystal clear that sellers are no longer required to offer any compensation to a buyer’s agent. 

Buyers now will be required to negotiate directly with their own agents and must enter into signed agreements that outline how they will compensate their agent (flat fee, hourly rate or other arrangements), the amount they will pay and what services they want their agent to provide. Written agreements will be required before a buyer and their agent can do any in-person or live virtual home tours. Buyers do not need a written agreement if they are just speaking to an agent at an open house or asking them about their services.

There are also changes to how and where real estate professionals may communicate with each other about offers of compensation. These offers are no longer allowed on Multiple Listing Service platforms, which are private databases created, maintained and paid for by real estate professionals and provide property listings to Zillow, Trulia, Realtor.com and others.  

Individual agents and real estate companies, however, will still be able to reference compensation on their own websites. 

“These changes will bring more transparency and more clarity for home sellers and buyers,” said Jennifer Branchini, regional vice president of the National Association of Realtors for California, Hawaii and Guam. Branchini, who served as last year’s president of the California Association of Realtors, manages the Compass real estate office in Pleasanton.

Talk of the industry

The lawsuit and the National Association of Realtors’ subsequent agreement are the talk of the industry — but little of it on the record. Numerous local Realtors, the Silicon Valley Association of Realtors, the Sunnyvale office of MLS, and the Real Estate Research Institute of Hartford, Conn., all either declined comment or did not return messages for this story.

Michael Repka, CEO and general counsel of DeLeon Realty of Palo Alto, had plenty to say, however. He said the 5% to 6% commission structure — including sellers paying 2.5% to agents representing buyers — has been the norm throughout the industry since he joined it in the 1990s.

He said a recent analysis of home sales in Palo Alto valued at between $2 million and $10 million, revealed that nearly 95% of them included the 2.5% fee paid by sellers to agents representing buyers.

Repka said he believes the rule changes will be good for the real estate market. With sellers now looking at paying a commission of only 2.5% to 3.5% on any given transaction, Repka said this could persuade more long-time Midpeninsula homeowners to sell their homes. That, in turn, could put more badly needed housing inventory onto what has been an historically tight market in recent years.

“This new situation results in something that is more fair to the seller,” he said.

The new rules still allow sellers to offer some compensation to the agents of buyers, but the amount paid, if any, is now up to the seller, Repka added. 

“Typically, sellers had no option to pay less than the total commission. Even if the buyer’s agent’s involvement was minimal, or if the buyer discovered the property on their own (without the assistance of an agent), the listing agent retained both sides of the commission,” Repka said. 

This practice, he explained, has been used to encourage agents to point buyers toward properties that offer them higher commission rates. Sellers who didn’t offer 2.5% commission to a buyer’s agent, allegedly risked having their listing “blacklisted” by some real estate agents, according to Repka. 

“In essence, buyers will now have access to information about all homes available for sale, irrespective of whether the seller offers minimal or even no compensation to the buyer’s agent,” Repka said. 

According to the settlement facts outlined on the National Association of Realtors’ website, the association already had MLS policies in place regarding the non-filtering (or removal) of listings based on compensation. The new rules amend that policy “for clarification purposes and to ensure consistency with the proposed settlement agreement.”

Whether the 6% commission has been a longstanding and common practice, depends on whom one speaks to in the industry. 

One veteran Midpeninsula agent, who preferred not to be named, said 6% commissions have never been demanded across the board by agents locally, adding commissions are typically negotiated between home sellers and Realtors — and discounted commission rates are fairly common “to keep transactions alive.”

She said it’s not unusual for agents to “absorb costs” at times for sellers and buyers.

While the new rules provide more transparency and give sellers more options, some say the homebuying process may become more challenging for first-time buyers. 

“At a time when home prices and mortgage interest rates are higher, these new rules place an additional financial burden on homebuyers, particularly first-time homebuyers who are already struggling to come up with a down payment to purchase a home.” Eileen Giorgi, president of the Silicon Valley Association of Realtors, said in a news release from the association. 

New California requirements in the works

On the buyers’ side, Branchini, regional vice president of the National Association of Realtors, said the issue also has attracted the attention of lawmakers in Sacramento. The California Legislature currently is considering a bill that would require written agreements between agents and homebuyers. It would enshrine the requirement in state law, complementing the new industry directives.

Mantill Williams, Washington, D.C.-based vice president of communications for the National Association of Realtors, said 18 states currently have such laws, with several more, including California, now proposing similar legal requirements.

Assembly Bill 2992, authored by Assembly member Stephanie Nguyen, D-Elk Grove, would mandate buyer/broker written agreements — already required for sellers and brokers. The bill is still working its way through legislative committees.

Despite the National Association of Realtors’  widespread coverage, the association’s agreement does not yet cover all brokers in the industry. Officials of HomeServices of America Inc. of Edina, Minn., are still litigating the lawsuit, known as the Sitzer-Burnett vs. National Association of Realtors case. HomeServices of America is the parent company of Intero Real Estate Services, which has local offices in Palo Alto, Menlo Park, Los Altos and Redwood City.

David Goll is a freelance writer who regularly contributes to the Real Estate section.

– Linda Taaffe contributed to this article.



This article was originally published by a www.paloaltoonline.com . Read the Original article here. .

Read More
By
In News

Florida’s real estate market has a split personality: What to know if you’re buying or

No Comments


Florida’s real estate market has a split personality: What to know if you’re buying or selling in the Sunshine State

Florida’s housing market is a tale of two states. On the coast, condo prices are falling with residents being driven out by high insurance costs and assessment fees, while inland, the cost of single-family homes is holding steady. Local experts say this divergence is driven by soaring insurance premiums and rising assessment fees under new state regulations, which have significantly affected condo owners. [Source: Realtor.com]

Florida house named HGTV’s 2024 Dream Home is now for sale

Every year, television network HGTV hosts a “Dream Home” giveaway, and this time a waterfront Florida home was up for grabs. Marie Fratta, a teacher from New York’s Westchester County, won the pad (and a new Mercedes-Benz and $100K) three months ago, and now it appears she’s looking to get rid of it. [Source: Orlando Weekly]

This Florida city was hit hard when the 2008 housing bubble burst—now prices are falling again

While national aggregate home price indices are hovering around all-time highs, some regional housing markets in states like Florida, Texas, and Louisiana are experiencing home price corrections. This includes the Punta Gorda metro area in Southwest Florida. [Source: Fast Company]

Condo HOA fees jumped 60% in South Florida in past 5 years. Why higher costs are ahead

South Florida condo owners, burdened by spiraling insurance, repair bills and a new state law, saw their association fees shoot up nearly 60% over the past five years — driving some to consider difficult financial decisions to make their next HOA payment. [Source: Miami Herald]

Orlando home-purchase cancellations highest in country

Across the U.S., buyers are increasingly backing out of home purchases as prices rise and mortgage rates remain elevated. Orlando is seeing this trend play out in a more pronounced way than any other major market, with about 900 home-purchase agreements canceled in June, according to a report from Redfin. [Source: Orlando Business Journal]

STAT OF THE WEEK
13.4%
Farm real estate values in Florida jumped by 13.4% from 2023 to 2024. [Source: CVille Right Now]

ALSO TRENDING:

› South Florida real estate firm significantly grows Orlando presence [Orlando Business Journal]
KW Property Management & Consulting has added three new properties to its management portfolio in Central Florida totaling more than 1,600 units. The Miami-based firm has been contracted to oversee two condominium towers in downtown Orlando.

› It’s Ritz-Carlton vs. National as South Beach heavyweights battle over condo for billionaires [Miami Herald]
On Collins Avenue in South Beach, along a strip of jazzy historic mid-century high-rise hotels that have defined the city skyline for decades, two giants are going at it. And the outcome of their long-running battle could forever alter the look and feel of a landmark Miami Beach district that harks back to the city’s Golden Age. Whether that’s for the good for the future of highly popular but perennially troubled South Beach, or a harbinger of its continued erosion, is the gist of the dispute.

› Osceola joins movement to reject tax incentives for affordable housing [Orlando Sentinel]
Joining a growing list of municipalities across the state, Osceola County has decided to opt out of a program that uses tax incentives to boost affordable housing. The board of county commissioners voted swiftly and unanimously last week that Osceola will no longer provide property tax exemptions under Florida’s Live Local Act.

› Tampa reopens Rental and Move-in Assistance Program applications [WTSP]
The city of Tampa’s Rental and Move-in Assistance Program, or RMAP, is accepting new applications beginning Thursday, Aug. 8. The decision to re-open applications comes after significant rent increases in the Tampa housing market over the past few years.

Tags:
Real Estate eNews

Previous Real Estate Updates:



This article was originally published by a www.floridatrend.com . Read the Original article here. .

Read More
By
In News

Buying or selling a home set to change on August 17

No Comments


KSHB 41 reporter Grant Stephens covers issues connected to access to housing and rent costs. Share your story idea with Grant.

—

There are big changes coming to the way you buy or sell a home.

These changes stem from a series of lawsuits intended to make the home buying process more transparent.

The changes take effect August 17th.

An agent working with a buyer will have to work out an agreement before the prospective buyer and real estate agent look at a property together.

KSHB 41 News staff

Home in Kansas City area

“When a real estate agent says, ‘Hey, starting August 17th, you have to sign this agreement,’ they’re telling you the truth,” said Holden Lewis with NerdWallet.

You may be familiar with the standard five to six percent commission rate you’d have to pay in the past.

It’s split between buyer’s and seller’s agents and is often baked into the total cost of the home.

The changes mean there’s now an extra layer of negotiation that could change that standardized fee.

“It’s gonna specify how much you’re gonna pay that agent,” Lewis said.

Realtors like Kathleen Spiking with the Rob Ellerman Team say it might change how contracts are written and how they’re paid.

KSHB 41 News staff

Kathleen Spiking

“They’re training us on what’s going on, what’s does this look like, how does it appear in a contract,” Spiking said.

But since she’s always been upfront with costs, it won’t change the day-to-day.

“Personally, for me, it doesn’t affect the way that I run my business,” she said. “I still have communication up front with all of my clients, whether they’re buyers or sellers, and I think maybe for people it would be further and more thorough communication at the beginning and during the process of buying a home,” she said.

—





This article was originally published by a www.kshb.com . Read the Original article here. .

Read More
By
Load More
Pin It