New Commission Rules - Good or Bad?

2024 Aug 22 | ALL BLOG POSTS

by Mollie Meyers

I was compelled to write this with all of the changes in Real Estate going on:

As a broker, owner, of Mollie McClure Meyers, Inc. for over 40 years and a Master Broker, I want to share my thoughts on the litigation and the National Association of Realtors settlement to resolve claims by home sellers related to broker commissions which are now negotiable.

First I think it is a good idea. Transparency and professionalism is needed in our profession, just as cream rises to the top, brokers who work hard to gain trust from their buyers and sellers and who are diligent in pulling out all the stops to sell a property or to locate the perfect property will always be successful.

Realtors should explain to their sellers that it is in the seller's best interest to offer compensation to a buyer's broker. Also commissions should be based on the work involved.

When a buyer signs a mandatory showing and compensation form, the buyer needs to know that if he or she is working with a good negotiator, chances are that the seller will include compensation to the buyers broker and therefore the buyer will not need to pay his broker. However, if the buyer likes a property where the seller refuses to pay any compensation the buyer should be willing to pay his broker for using their skills to negotiate the best deal and to walk the buyer through all of the actions including inspections, mortgages and Insurance, Etc. If a purchase is made the compensation is noted as a line item on the closing statement.

Perhaps both buyers and sellers need to reflect on this point if they plan to use a stockbroker or financial advisor to grow and protect their hard-earned savings. Would they prefer paying someone who is not well qualified because the fees are less? I think not!!!

I am a small office but we handle expensive Residential properties and some Commercial properties as well. I have always allowed my agents to be flexible with commissions and I do the same. The focus should be on helping the client instead of the compensation, but having said that a lot of effort and hard work goes into helping buyers or sellers and a frank discussion about the compensation is essential before moving forward.