In the week BEFORE the new rules went into effect, there were 29 NSDCC listings that were marked pending. In the first week AFTER the new rules went into effect, there were 38 new pendings.
Homes keep selling. Buyers and sellers keep moving, and Realtors keep helping.
It’s the other jokers who got in the way.
Somehow, the National Association of Realtors conspired with ambulance-chasing attorneys to levy big fines against brokerages for crimes they didn’t commit. The alleged offenses were committed by independent contractors who had home sellers pay a bounty to buyer-agents for causing their home to sell. The seller only paid the bounty if the agents involved were able to make both the sellers and buyers happy enough that they found a way to close escrow. If the sellers weren’t happy enough, they paid nothing.
We called it a ‘buyer-agent’s commission’.
Now we call them ‘compensation paid from seller concessions’.
We put different words on it, and added a load of new paperwork. That’s it – and homes keep selling.
But the brokerages are tired of being pushed around, and the really big changes are still to come.
1. The Clear Cooperation Policy is going to go away.
In the coming months, all the big brokerages will be suing NAR to rescind the policy that requires an agent to input their new listing into the MLS within one business day after they promote it publicly. The policy was a continuance of the NAR paranoia about protecting smaller brokerages, but that ignores giving the seller a choice on how they want to market their property.
2. Brokerages are going to leave the MLS.
I’ll call it a rumor because I didn’t hear from Reffkin’s mouth myself, but it makes sense. Why be a member of a club that sells us out and fines us $50 million? The commercial brokerages get along just fine without an MLS, as does the residential brokerage business in NYC.
Zillow provides the same benefit, without the lawsuits. Let’s cut a deal with them to upload our listings there and we won’t need the MLS.
What about cooperating with agents in other brokerages?
The NAR Settlement has effectively cut off that benefit already. The main benefit of the MLS was publishing and guaranteeing the buyer-agent fees, but that’s gone now. Every buyer-agent has to call around to find out what the “seller concessions” might be, if any. Sounds just like the commercial brokers, doesn’t it? And they have never had an MLS.
Is defecting from the MLS what is best for buyers and sellers?
We will sell you on that, don’t worry. Besides, you will still have Zillow, and their manipulated zestimates!
Zillow will become the defacto MLS, just like they do it in New York City!
NONE of the realtors in NYC belong to the NAR.
None of them belong to an MLS.
Residential agents had to call around or check each broker’s website to share listings outside of their brokerage.
Then Zillow came along and offered Street Easy, which gradually became the defacto MLS.
The business of selling homes in NYC didn’t change much, and they are laughing at us NAR members.
Does this mean the already numerous number of cold calls asking if I want to sell my properties will increase?
Maybe I could hold a silent auction so all interested brokerages could bid for my listing.
Maybe I could hold a silent auction so all interested brokerages could bid for my listing.
It is a choice but because it is so different than the norm that agents wouldn’t be able to easily adapt to that model. But you only need to do it once.
Mainstream auctions have a better chance of disrupting the whole.
From the seller’s perspective why not consider a selling contract like a home improvement contract? Solicit bids, narrow the candidates and choose a “contractor.” As you suspect I might be an educated consumer of these products and I would very much lean to an agency bid that proposed auctions as a mechanism as long as the costs are reasonable. I’d prefer a soft auction where price is not the only consideration. Maybe top three bidders get an answer in one hour? An all cash two week offer 3% lower than the highest bid with contingencies or a lower offer that tugs at the heartstrings.
Yes what you describe is interviewing listing agents. It’s when you throw them a knuckleball on the commission structure that you will lose them. Keep it simple.
Susie in potatoland is selling her house again – this is the fourth time! We’ve been exchanging 20+ texts per day for the last week as we try to coerce her listing agent into doing the right thing.
She is struggling with the same thing all sellers do. Without the 1,000+ experiences of what kills deals that I have, it’s easy to want to do things that will likely tip over the buyers.
I think we will do a summary here once she is done. She has two offers after 3 weeks on the market and it is go time now.
“It’s when you throw them a knuckleball on the commission structure that you will lose them.”
I don’t see why now that the old commission rates having been blown up that any potential seller should not shop for a different compensation structure.
E.G. Here’s a retainer. Here’s a fixed contract for $20k on top for a sale and 2% of the rest above a set point.
Just an example.
Here’s a retainer. Here’s a fixed contract for $20k on top for a sale and 2% of the rest above a set point.
We can’t do retainers yet (DRE has to approve). But I’m all for it. Where are you going to move?