On Real Estate & More – September 2024

BUYING A HOME is one of the largest financial transactions most people will undertake. As I explained in last month’s article, the National Association of Realtors (NAR) reached a settlement agreement in March which took effect August 17, 2024, and will impact anyone buying or selling a home.

The following are the two primary changes from the settlement:

  1. NAR agreed to create a new MLS rule prohibiting communicating offers of compensation to a buyer’s agent on the MLS. Sellers can still offer compensation to a buyer’s agent, but it will no longer be communicated through the MLS.
  2. NAR also agreed to create a new rule requiring real estate agents working with buyers to enter into written agreements with the buyer before the buyer tours a home. The agreement must specify what services the agent provides and how they will be compensated.

Attention is now more focused than ever on buyer agency (the partnership between a homebuyer and their real estate agent). Some folks fear that buyer’s agency will go away, but the truth is that buyer’s agency is incredibly important. The purchase of a home is typically a person’s largest financial investment and real estate transactions are complicated and can be emotional. When a buyer is represented, there are generally fewer issues because the buyer better understands their options and choices. Buyer’s agents bring tremendous value to those they represent, including (but not limited to):

Education: Provide vital insights into the local market, inventory, pricing dynamics, processes, forms, contingencies, inspections, financing, closing costs, standard practices and potential challenges.

Guidance & Ongoing Consultation: Address a wide variety of real estate matters, offering guidance on property details, pricing, neighborhoods, investments, HOA rules, inspections, and other buyer queries.

Availability and Compensation: Are available 24/7 (including holidays and weekends) to respond to buyer needs, whether it’s answering questions, showing properties, or addressing urgent concerns. Real Estate is the only industry where the agent only gets compensated IF a closing occurs. An agent invests untold number of hours into every transaction and is not paid anything if the buyer decides to work with a different agent, or not purchase at all.

Research: Thoroughly investigates property details, regulations, covenants, restrictions, permits and other critical information.

Strategy: Assists buyers in formulating effective strategies, especially crucial during market fluctuations.

Offer Preparation: Ensures all details in the offer process align logically with contract timelines and contingencies.

Offer Negotiation: Negotiates between buyers and seller’s agent to establish mutually agreeable terms.

Finalizing Offer: Ensures all offer documents and addendums accurately reflect the transaction for the benefit of escrow, title and lenders.

Managing the Transaction: Proactively oversees various aspects of the transaction, from deposits to inspections and insurance.

Inspections & Repairs: Coordinates and manages property inspections, addresses any repair issues to ensure a smooth process.

Appraisals: Monitors appraisal process to comply with contract timelines and address any valuation or condition issues.

Managing Title & Escrow: Oversees communication with title companies and reviews title reports to make sure documentation is accurate and any discrepancies resolved.

Managing the Walkthrough: Address issues that may arise during property walkthroughs and ensure everything is in order before closing.

Managing the Closing: Confirming all keys, garage openers, and property details are provided to the buyer while addressing any last-minute issues.

Post-Closing Issues: Assist buyers with any post-closing challenges, leveraging inspection reports and trusted vendors.

Follow-Up: Continuously follow-up throughout the entire process, from initial contact to post-closing matters.

Comprehensive Representation: Serving as a comprehensive advocate for buyers, navigating complexities, and safeguarding their interests in every aspect of the real estate transaction.

Buyer representation extends beyond defined roles, demanding ongoing commitment, problem-solving expertise and attention to detail in the ever-changing landscape of real estate transactions. Real Estate is complicated, and transactions can be stressful. This is similar to hiring a tax professional when preparing taxes—because it’s complicated and because you’ll have more success working with a professional who can provide their expertise and save you from doing something wrong. It is the same in real estate—it’s worth protecting such an enormous financial investment with a professional who can help you navigate the process and make it as stress free as possible.