What has, and what has not, changed about the role of a Buyer’s Agent when buying a home in Charleston, South Carolina

If you saw the headlines last month about certain changes associated with the settlement that was agreed to between the National Association of Realtors (NAR) and home sellers last Fall, you might be confused about what has, and what has not, changed when it comes to the role of a buyer’s agent in real estate.

First and foremost, real estate commissions are and have always been, negotiable.  Buying and selling a home is a “highly complex, relatively infrequent transaction, and the cost of making a mistake is huge.”  Remember, for most people, buying and selling a home is the largest single financial transaction which they will ever be involved.  Therefore, buyers and sellers should always ask tough questions to understand the differences between agents and brokerages and how the agent they hire can best help them achieve their real estate goals.

Did you know that nearly 9 out of 10 sellers use the services of a real estate agent when selling their home?  Traditionally, a seller interviews a listing agent and then enters into a listing agreement where they decide if they want to offer compensation, and what amount of compensation to offer, to the agent representing the buyer.  As a result, the buyer’s agent fee is built into the listing price of the home.  Prior to last month, the fee being offered was communicated to the buyer’s agent through a compensation field in the Multiple Listing Service (“MLS”).

What has changed?

As part of the settlement agreed to by NAR, the MLS can no longer have a compensation field that shows what commission a seller is offering to the agent representing a buyer in the transaction.  This change was based on allegations that some agents would fail to show homes that offered lower commissions.  To be clear, these allegations were highly contested; real estate professionals should always put their client’s interests first, showing and sourcing properties that help meet the client’s real estate needs.

Remember, that while 9 out of 10 sellers use a real estate professional, so do 86% of home buyers.  Having the buyer’s agents commission come from the sales price makes buying a home more obtainable for a greater number of home buyers, due to all the other expenses associated with buying a home, including the down payment and closing costs.

What has not changed? 

The rule changes do not prevent, limit, or even discourage a seller from paying a buyer’s agent.  Sellers will still enter into listing agreements and decide if they want to offer compensation, and what amount of compensation to offer, to the agent representing the buyer.  The only thing that changes is the removal of the compensation field in MLS.  Nothing has changed that impacts either the services an agent provides to their clients or the importance of having a knowledgeable professional agent working for you.  In fact, over the past 10 months, since the settlement was announced, we have seen very little change in the number of sellers offering buyer’s agent compensation.

Final Thoughts

Buying and selling a home is a personal and complicated process and you need a trusted agent who can advise and help you navigate all the hurdles that will pop up along the way.  As your real estate agent, my goal, whether on the seller or buyer side, is to use the expertise and resources at my disposal to help you achieve your individual real estate goals.

And that’s an investment that can make all the difference.