Our president of the western United States was at our regional sales meeting on Friday. At the end, he announced that Compass has joined with all of the other brokerages who were identified in the NAR settlement as having over $2 billion in sales volume – a group that employs so many agents that it makes up 86% of the total NAR dues.
They have all hired the same law firm, and they are going after NAR. I think it means that the settlement that forced the big brokerages to pay $400 million will get litigated, and hopefully the lawsuit will get appealed too.
Hopefully, it isn’t just a delay tactic. The lawsuit should get appealed because the defense put on by NAR was pathetic and very arrogant – it was like they thought that they just had to show up to pick up their automatic win.
I don’t think any agent will mind if the buyer-agent commission isn’t required to be inputted into the MLS – we will live with that. We’ll probably live with having a required written contract with our buyers too.
But sellers should have the right to incentivize the buyer-agents. Because the DOJ won’t come out and state that clearly – they only hint at it – we will be living in purgatory until someone forces the issue. The brokerages should help defend the practice, and see it through to the end.
Some sellers may not agree with me now, but the market slowdown is coming and you will want additional tools to help sell your house in the very near future. If you don’t want to offer an incentive to buyer-agents, no problem.
Also mentioned on Friday is that they are going after the Clear Cooperation Policy too – the NAR mandate that a listing must be inputted into the MLS within one business day after any public marketing. We’ve come to live with that policy too, but I think it shows that they are bringing all the firepower to destroy the National Association of Realtors and build anew.
The president didn’t say anything about this being quiet, so I would think that there should be an announcement any day now. If this blog post disappears, then it might be a while?
The filing of legal action should toss the August 17th date up in the air.
It means the buyer-agent commissions will still be advertised in the MLS (however much you want to pay) and written contracts with buyers will still be optional.
A longer runway on those would be nice.
“Some sellers may not agree with me now, but the *market slowdown is coming* and you will want additional tools to help sell your house in the very near future.” When do you see this coming, Jim, and what we will be the reason(s) (in your opinion)?
Whale bone corsets, ice tongs, buggy whips and collar stays.
DEFEND TRADITION!
The Consumer Federation of America (CFA) released a report that identifies unfair provisions in buyer agency contracts that an increasing number of home buyers are being asked to sign. The report also advises home buyers whether to sign these contracts and how to negotiate them.
“Buyer agency contracts have the potential to protect home buyers but the way most are written, protect only agents and their brokers,” said Stephen Brobeck, a CFA senior fellow and author of the report. “If buyer brokers refuse to improve unfair contract provisions, buyers should consider hiring an attorney and working directly with listing agents,” he added.
When do you see this coming, Jim, and what we will be the reason(s) (in your opinion)?
It was mid-May.
Here the timing was perfect – they hit the market in early-March:
https://www.compass.com/listing/13557-penfield-san-diego-ca-92130/1524821148249056649/
Boom, it gets bid up to $3,100,000.
It was inferior to this nearby house in just about every way:
https://www.compass.com/listing/13335-winstanley-way-san-diego-ca-92130/1576977769399823273/
I saw it on broker preview on May 15th. Not only had I seen Penfield, but I also did a video so you can compare too.
The listing agents asked me what I thought. I usually never answer because most agents can’t handle the truth and just get defensive and want to fight instead. But these agents were long-timers so I thought they might appreciate my feedback.
I told them that I felt the market had just shifted, and it was going to get harder to sell homes from now on. I told them about Penfield, and how I thought they got lucky. They didn’t jump up and agree with me, but I could tell that they had their reservations too. All good agents feel it.
They had listed for $3,199,000, and three weeks after I saw them, they lowered the price to $3,049,000. It went pending four days later.
Even though Winstanley had 500sf more square feet and a better kitchen (Penfield’s kitchen cabinets were painted), it will end up selling for less. If they wouldn’t have lowered their price early, they could still be sitting around unsold too!