Recent and prospective home sellers and buyers are excited about the proposed settlement by the National Association of Realtors (NAR, which is willing to pay out $418 million to home sellers over about four years) and what it means for the industry. You've probably heard whispers about repercussions.
For people looking to buy or sell a home, these whispers are confusing at best and inaccurate at worst. Rumors that the settlement will cause chaos throughout the housing market only fuel suspicion and fear.
Will the outcome of the settlement actually change the face of real estate for people looking to buy or sell a home? In short: No.
Knowing the big picture allows buyers and sellers to make informed decisions about whether they are ready to move forward with a home transaction without overwhelming concerns and questions.
Two of the most well-known public claims about the NAR proposed settlement are that it could increase home prices and weaken the relationships buyers and sellers have with their brokers.
Given NAR's extensive reporting, it's easy to see how these assumptions came about. However, these are essentially “conceptions”. In reality, the person selling or buying a home always has the power to negotiate the commission. There has never been a fee amount or rule set by NAR.
The cost of housing is determined by historical conditions, including economic conditions, market conditions, and demographic trends. And now is the time for real estate agents to offer more value to their customers than ever before.
Future relationship
Phoenix Realtors strives to achieve the best results for buyers and sellers. They understand the responsibility and weight that comes with buying or selling a home, and are proud to be a trustee in such an important transaction.
The idea that home sellers can save money by DIYing their home sales is not just a myth, it's inaccurate. According to a recent report from Clever, more homeowners (in 2022 and 2023) who choose to sell their homes with the help of a real estate agent than those who opt out of dealing with a real estate agent They report that they have saved .
Additionally, the same Clever report found that people who didn't work with a real estate agent were twice as likely to express dissatisfaction than those who did work with a real estate agent, and many of them felt that they were “less than happy to go through the process alone.” It also shows that he admitted that he was “overwhelmed.” .
When a home seller or buyer declines the assistance of a real estate agent, they are also giving up certain knowledge and skill sets that only a real estate agent possesses, including:
Market Expertise: Ability to identify local housing trends, thoroughly understand neighborhoods and pricing, and evaluate comparable properties.
Negotiation: Provides buyers and sellers with the ability to negotiate specific pricing, concessions, and contingencies.
Professional Partnerships: Leverage relationships with industry experts such as inspectors, lenders, and appraisers to prioritize customer needs.
Although this is just a high-level list of what real estate agents provide to home sellers and buyers, it clearly demonstrates the value of a real estate agent. Ultimately, the cost of not working with an agent can be significant.
Many people who buy and sell homes on their own without going through an agent experience various difficulties.
From paying losses and high costs to ending up in legal and contractual predicaments, to spending thousands of dollars on unexpected repairs, you unfortunately choose to do it without a real estate agent. There are many potential downsides to this case.
Ultimately, real estate agents want home buyers and sellers to be happy, whether they're downsizing, expanding, buying (or selling) for the first time, or relocating.
If there's one thing that's important to current and future home buyers and sellers, it's that real estate agents are prepared to work harder than ever. Whether you are selling a home or buying a new home, a real estate agent will guide you, protect your best interests, and help you achieve the results you desire.
Cheryl Borden is Chair of the Board of Directors of Phoenix REALTORS®, a member-first organization serving more than 11,000 real estate sales professionals in the Valley.Learn more about PhoenixRealtors.com.
