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• The rules of the recent NAR agreement went into effect in August. We spoke to real estate professionals to see what’s changed.
• Buyers can still benefit from working with a real estate agent and, in many cases, the seller can still cover the cost.
• Sellers can always negotiate with both their agent and the buyer how much they will pay.

Earlier this year, the National Association of Realtors agreed to a $418 million settlement that made some Big changes in the way we buy and sell homes..

These changes went into effect on August 17, 2024. Before the settlement rules were implemented, it was unclear exactly what impact it would have on the home buying process. Would buyers stop using real estate agents to buy a house? Willpower first time home buyers Will they be excluded from the process because they have less cash to contribute to the transaction?

Two months later, we spoke with real estate professionals across the country to see how the home buying process has evolved following the NAR settlement.

How has the home buying process changed after the NAR settlement?

Here’s the fine print of what’s changed:

• Home buyers now have to sign a contractsometimes called a buyer-broker agreement, to be able to work with a real estate agent.
• If a seller offers to compensate the buyer’s agent, that information cannot be advertised on the MLS, which is the database used by real estate professionals in a given market to find and list properties for sale. Sellers can still offer concessions on the MLS, which allow you to pay part of the buyer’s cost. closing costs or other expenses related to obtaining a mortgage and purchasing a home.

In some markets, not much has changed

What have these changes been like in practice? Depending on the norms of your market, you may not notice much difference.

Traditionally, The sellers have been the ones who paid. both your agent’s commission and the buyer’s agent’s commission. Many speculated that the NAR settlement would cause fewer sellers to offer commissions, forcing buyers to pay their agents out of their own pockets. But in many areas, that hasn’t been the case.

“I haven’t found any offers yet that don’t offer at least some level of compensation,” he says. Blake BlahutAssociate Broker at Realty ONE Group Inspiration in Orlando.

Other real estate professionals we spoke to confirmed this.

“It definitely creates confusion among buyers because many of them think they are obligated to pay the buyer’s broker, which is not necessarily true,” he says Jennifer Okhovat, a Compass real estate agent in Los Angeles. In the Okhovat market, sellers usually still pay the buyer’s agent commission.

Sellers can still pay commissions, but there may be more negotiations

Commissions have always been negotiable, but that hasn’t always been obvious to buyers and sellers. Now, there may be more back-and-forth between seller and buyer as they determine who pays for what.

For example, a seller may be willing to pay the buyer’s agent commission, but might try to negotiate a reduction.

If you want to buy a home but the seller is not willing to pay your agent’s commission, you will have to pay it yourself or look for a different home. Mortgage lenders It will not allow you to fund agent commissions, so you will pay this cost out of pocket.

Buyers must sign an agreement with their agents.

As a buyer, before your agent can do any work for you or show you any homes, you will need to sign a buyer-broker agreement. This agreement will outline how much your agent will be paid for their services.

“It describes how compensation works,” says Blahut.

It is usually a percentage of the price of the home you purchase, but it could also be a specific dollar amount or an hourly rate. You can negotiate this amount before signing.

What Home Buyers and Sellers Need to Know After the NAR Deal

It often still pays to work with a buyer’s agent.

Having a buyer’s agent can still be extremely valuable.

“Where agents often add value is in their network, knowledge, resources and their ability to go above and beyond,” he says. Danielle Andrewsreal estate broker with Realty ONE Group Next Generation in Tallahassee, Florida.

Agents can give you helpful information about a home or help you identify problems that could turn into costly repairs in the future. And most importantly, they work to you.

David Hermanvice president of Douglas Elliman Real Estate in New York City, says that a seller’s agent (commonly called a listing agent) has a duty to do what is best for their client, the seller. So if you make them an offer, they won’t tell you if the house is overpriced or if the seller would be willing to accept a lower price than the asking price. An agent who represents you will tell you these things.

“If I were a buyer, I would like to have representation,” Herman says.

But be sure to find an agent who will add value to the transaction.

There is a many real estate agents and not everyone excels at what they do.

Ask friends or family for recommendations and talk to a few different agents to get an idea of ​​who you work well with. Blahut recommends interviewing potential agents as if you were hiring someone for a job.

Understand What You Might Owe When Signing a Buyer-Broker Agreement

Andrews says buyers should ask plenty of questions before signing a contract with an agent. Find out how long the deal lasts, what happens if you want to walk away, and whether you’ll need to pay a retainer or any other fees in addition to the agent’s commission.

Offering compensation as a seller can still be a smart move

As a seller, not paying the buyer’s agent commission can help you save money. But you might find it harder to attract buyers.

When deciding whether to offer compensation to the buyer’s agent, talk to your agent about what makes sense in your local market.

“It is important for agents to provide an accurate expectation of the market,” says Andrews. If buying demand has slowed in your area and there aren’t as many buyers looking for homes, “you may not want to add the extra barrier of having to negotiate commissions.”