The news reports are confusing for consumers (and frankly real estate agents).
I have been studying the information to help convey the practical facts.
Commissions have always been negotiable. However, an agency has the right to determine their fee for the services provided. This fee is disclosed to the consumer, and the consumer has the option of working with the agency or not.
No fee is earned until we complete a transaction. Compensation is only paid if we finalize/close on a sale.
Currently, the listing agreement with the seller states the total compensation to be paid, and ultimately shared between the brokerages and the seller/buyer agents.
The new regulations (effective July 2024) will require buyer agency agreements. Buyers will acknowledge their financial responsibility for the buyer broker’s fee. This fee can be paid directly by the buyer, or negotiated in the offer to the seller in the form of a concession from the seller, or as a portion of the listing broker’s commission.
Bottom line- it’s a math equation to satisfy all parties.
Both the buyer and seller are ultimately paying for their representation through the purchase price funds and sale proceeds.
Moving forward, we will clarify the language that will be acceptable to lenders regarding seller concessions.
As a lifelong resident, with 40+ years of experience in this market, I am here to help buyers and sellers navigate the process.
Thank you for trusting me to assist with your island real estate needs!
Rainy days…
Well, at least our lawn looks great 😉