Do I really have to sign a contract to see a home?

As a home buyer, finding a house has become incredibly easy with today’s technology. You simply go online, browse homes you like, pick the best one, and click a button to schedule a showing. But as of August 17th, 2024, there's been a slight change to this process. While the steps remain largely the same, there's one important difference: you now need to sign a buyer agency agreement before you can view a home.

Wait, what?! Yes, you heard that correctly. Since this change took effect, many buyers have been asking the same question: Do I really have to sign a buyer agency agreement just to see a house now?

So, how did we get here? It all stems from a lawsuit against NAR and several top real estate brokerages, alleging a lack of transparency in real estate commissions. To address this, NAR implemented new rules on how commissions are handled. The first major change was removing the commission field from the MLS, meaning buyer agents are no longer guaranteed a commission. This change aimed to prevent agents from steering buyers toward or away from properties based on the commission offered.

As a result, buyers and their agents now need to negotiate compensation directly before even starting the home viewing process. If a seller is not offering compensation to the buyer's agent, the buyer will be responsible for paying their agent directly. However, this fee can still be negotiated into the offer and collected from the seller at settlement, as has been done in the past. The key difference is that commissions are no longer guaranteed, as they were when listed in the MLS. If a seller is unwilling to pay part or all of your commission, the buyer would be liable for the difference.

So, what does this mean for you? First and foremost, it's more important than ever to work with an experienced agent who can negotiate on your behalf, including commission terms. One of the biggest changes we expect to see in the industry is that more buyers will be interviewing agents ahead of time to ensure they are represented by the best possible agent.

Our team has successfully negotiated every contract to ensure sellers cover the buyer agency commissions since these changes took place. We believe that sellers have always paid commissions out of the sale, and we expect that to continue.

If you’re thinking about buying a house in this new real estate market, we’d love to set up a buyer consultation to help you understand our services and find the right property.  Give us a call or slide into the DM’s, we look forward to helping you!