While some real estate experts are predicting a seismic shift in the housing market after a $418 million settlement regarding commissions paid to the listing agent and the buyer’s agent, several veteran Georgia realtors are saying that it’s much ado about nothing.
According to a statement by the National Association of Realtors on Mar. 15, the agreement would end “litigation of claims brought on behalf of home sellers related to broker commissions.”
However, the statement continues that the NAR denies “any wrongdoing in connection with the Multiple Listing Service (MLS) cooperative compensation model rule (MLS Model Rule) that was introduced in the 1990s in response to calls from consumer protection advocates for buyer representation.”
Several national publications predicted that the proposed settlement would dramatically drive down homebuyers’ costs — and push some real estate brokers out of business.
However, local agents are saying that because the Georgia Association of Realtors already has an established buyer-broker agreement in place, very little will change in the state regarding homebuyers or sellers.
A buyer-broker agreement, according to homelight.com, is an important and legally binding document that’s designed to protect both the buyer and the buyer’s agent.
“This agreement clearly outlines what the agent will do for you, the terms of the agreement, and how the agent will be compensated, which depends on what kind of buyer’s broker agreement you have,” the website said.
According to the terms of the settlement, the NAR will enact a rule that all MLS participants enter into written agreements with their buyers.
“NAR continues, as it has done for years, to encourage its members to use buyer brokerage agreements that help consumers understand exactly what services and value will be provided, and for how much,” the NAR statement said.
Not every state has had these types of agreements, real estate experts said, which is to Georgia’s advantage.
“The settlement in question is in regards to an agreement that we have already had in practice in Georgia,” David Boehmig, CEO and President of Atlanta Fine Homes Sotheby’s International Realty, said. “The only change will be that there will be more conversations with the buyer but I don’t see any real effect that it will have on either buyers or sellers.”
“We are ahead of the curve nationally because we have this agreement in place on the front end,” Atlanta Fine Homes Realtor Chase Mizell said. “Many so-called experts on the national level have been running with a false narrative and it’s created a tremendous amount of confusion. But in Georgia, it’s business as usual.”
Bob Fiscella with Atlanta Communities Real Estate also called it “a big to-do about nothing.”
“In all my 17 years in real estate, I have never been told what to put in those blanks in the contract [of the buyer-broker agreement],” he said. “In fact, if I’m working with a friend or someone who is struggling to get to a point where the home is affordable, I might take a little off my side so they can put it towards their closing costs.”
Both Mizell and Fiscella say that they haven’t experienced any pushback from potential buyers or sellers since the proposed agreement was publicized. And despite elevated interest rates over the past year, the market remains hot.
“I listed a house on Thursday and by Sunday it was under contract that was $30,000 over the listing price,” Fiscella said. “In my opinion, only supply and demand will dictate how the real estate industry changes.”
Boehmig said he has also seen strong spring sales.
“Business is good, and we are seeing a strong level of both buying and selling in Atlanta,” he said. “I think people are ready to get on with their lives, after 18 to 24 months of uncertainty with interest rates.”