Looking to buy a home? You may now need to factor in the cost of your agent's commission
Thinking of buying a home with the help of a real estate agent
LOS ANGELES — Thinking of buying a home with the help of a real estate agent? You can no longer take it for granted that a seller will cover the cost of your agent’s commission.
Home sellers have traditionally offered a blanket commission to a buyer’s agent when they listed their home on the market. But that will no longer be allowed as of this weekend, when various changes to U.S. real estate industry practices are set to take effect.
A homebuyer may still try to negotiate such an offer from the seller. But if they decline, that would leave the homebuyer on the hook for paying for their agent’s services.
The National Association of Realtors is behind the policy changes, which stem from its $418 million settlement earlier this year of federal class-action lawsuits that claimed U.S. homeowners were forced to pay artificially inflated real estate agent commissions when they sold their home.
Companies behind several major real estate brokerage brands, including Keller Williams, Anywhere Real Estate, HomeServices of America, Re/Max and Redfin, also agreed to pay millions and make policy changes to make home seller lawsuits go away.
The new rules, which go into effect nationally on Saturday, apply to brokers and agents representing clients looking to buy or sell a home advertised on a multiple listing service, or MLS, affiliated with the NAR.
They boil down to two significant changes: Blanket offers of compensation on behalf of sellers to buyers’ agents will no longer be included in listings posted on the MLS, though they can still be made through other means. And homebuyers will be required to sign detailed representation agreements when they hire an agent.
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