Community Marketing & Real Estate Update

Understanding Recent Real Estate Changes:

What it Means for You

On August 17, 2024, the National Association of Realtors (NAR) rolled out new practices as part of a class-action settlement. These changes affect how real estate transactions are conducted, specifically how agents are compensated, and the agreements buyers and sellers need to sign.

Key National Changes:

1. Agent Compensation: Payment to real estate agents has always been negotiable. The changes are designed to clarify that the payments to the Buyer’s agent and the Seller’s agent don’t have to be linked. They can be handled separately.
2. MLS Listings: The Multiple Listing Service (MLS), which shows property listings, can no longer display how much the buyer’s agent will be paid.
3. Written Agreements Before Viewing Homes:  Before a realtor shows a home or shares a walk-through video of it, buyers must sign an agreement that details how the agent will be compensated. This is not required for open houses or first-time inquiries.

What This Means in Georgia:

Georgia has adjusted its real estate contract forms to reflect these changes:

For Sellers:

You have the option to either:

• Pay your broker an overall fee and designate compensation for the buyer’s broker.
• Or choose only to pay the listing broker and not designate a payment for the buyer’s broker.

Important Points:

• Buyers might avoid your home if there’s no payment allocated for their agent, and they want to avoid paying their agent themselves.
• Georgia has introduced a new form for the Buyer to ask for -- the Buyers Broker compensation in the offer to purchase. Now it’s a negotiation -- the Seller has a choice to accept or negotiate, and the Buyer has a choice to continue to pursue or not.

For Buyers:

• Georgia offers two types of agreements for viewing homes:
• Buyer’s Agency Agreement: The Buyer is a “Client,” meaning the agent must act in the buyer’s best interest according to a strict code of ethics.
• Agreement to Work with Buyer as a Customer:  Buyer is a “Customer.”  The agent’s duties are limited to basic tasks, not full representation.

Remember:

• In Buyer Agency, you’re only agreeing to “potentially” pay a compensation. You control which homes to see and which to make an offer on, including negotiating for the buyer’s agent’s payment in the Offer to Purchase.
• If a seller won’t cover the buyer’s agent compensation, you can walk away or decide if the home is worth the extra cost.

Other Considerations:

• All new agreements will state that agent compensation is negotiable and not set by state law. However, brokerage firms can have compensation standards.
• Real estate companies, like The Landings Company, can still advertise agent compensation on their websites and other media.
• Georgia has introduced “Pre-Showing Agreements” to clarify agent compensation before any home tours. The Landings Company has made these forms accessible on our website.

The Big Picture:

These changes are intended to lower costs and increase transparency in the real estate market. However, whether they will truly benefit consumers remains to be seen. Will homes be priced based on compensation levels or market values? Time will tell.

In the meantime, The Landings Company is here to assist in navigating these new real estate changes. If you have any questions or need guidance on how these updates might impact your buying or selling experience, don’t hesitate to reach out. Our experienced agents are here to provide you with the expertise and support you need to make informed decisions in this evolving market.