How the National Association of Realtors settlements could affect home buyers

Sacramento realtor president reacts to National Association of Realtors settlement

A LANDMARK SETTLEMENT COULD MAKE BUYING THAT FIRST HOME A LITTLE CHEAPER. THE NATIONAL ASSOCIATION OF REALTORS, SETTING A SERIES OF LAWSUITS AIMED AT ELIMINATING ITS RULES ON COMMISSIONS. AND ACCORDING TO THOSE LAWSUIT, HOMEOWNERS HAVE ARGUED THAT RULES SET BY THE ASSOCIATION FORCED THEM TO PAY WHAT THEY CALLED EXCESSIVE FEES FOR HOMES. AND JOINING US THIS MORNING IS SHERRY HOME WITH THE SACRAMENTO ASSOCIATION OF REALTORS TO TALK ABOUT THIS, BECAUSE, AGAIN, THIS IS STILL RELATIVELY FRESH. STILL VERY FLUID. BUT THIS CAN REALLY END UP BEING A JOLT TO THE INDUSTRY. ALL THE WAY ACROSS THE BOARD. OF COURSE, EVERYBODY IS REACTION TO IT IS GOING TO BE A COLLECTIVE GAS. BUT ULTIMATELY, YOU KNOW, THERE’S LET’S LOOK AT THE NUMBER OF REALTORS IN SACRAMENTO. THERE’S 8000 OF THEM. AND WE’RE DOING A VERY GOOD JOB BY AND LARGE, SELLING HOUSES. YEAH. AND THERE’S STILL SOME HOUSES TO SELL. NOT AS MUCH SUPPLY AND DEMAND ISSUES. SURE. NOT. NOT AS FAR AS THE BUSINESS MODEL ITSELF BECAUSE THIS THESE LAWSUITS REALLY STARTED TO GO AFTER, I MEAN, A NUMBER OF THINGS, BUT REALLY KIND OF FOCUSED A LITTLE BIT IN ON SOME OF THE COMMISSIONS THAT WERE MADE. SO WILL THIS POTENTIALLY CHANGE SOME OF THE BUSINESS MODELS IN THAT REGARD? UH, I DON’T BELIEVE IT’S GOING TO MATERIALLY CHANGE BECAUSE IT’S ALWAYS BEEN A NEGOTIABLE SITUATION. HOW MUCH YOU PAY FOR YOUR SERVICES HAS ALWAYS BEEN NEGOTIABLE. YEAH. JUST LIKE ANY OF THE OTHER COMPONENTS TO A REAL ESTATE TRANSACTION. SURE. ALWAYS BEEN NEGOTIABLE. UM, SO THAT ELEMENT OF IT IS, HAS ALWAYS BEEN A FREE MARKET. UM, THERE HAVE BEEN NORMS AND WHAT PEOPLE CAN EXPECT AND WHAT DO YOU KNOW? SOMEONE WHO IS SPENDING 250 HOURS ON A TRANSACTION IS, IS GOING TO GET PAID. YEAH, THINK ABOUT THAT. UM, BUT THERE IS IT’S ALWAYS BEEN NEGOTIABLE. YEAH. SO THAT AGAIN, IN CALIFORNIA, IT’S ALWAYS FALLEN BETWEEN ABOUT 5 TO 6% ROUGHLY IN TERMS. OF COMMISSIONS. BUT THAT’S SOMETHING THAT FOR THE MOST PART, BUYERS AND SELLERS HAVE BEEN ABLE TO NEGOTIATE IN THE PAST. AND EVEN AS OF RIGHT NOW, WELL, TYPICALLY IN A TRANSACTION, IF THERE’S A BUYER’S AGENT AND A SELLER’S AGENT, THE COMMISSIONS ARE SPLIT ROUGHLY DOWN THE MIDDLE. SOMETIMES YES, SOMETIMES NO. BUT I’VE ALSO HAD YOU KNOW, MUCH LESS IN FEES THAT I HAVE EARNED BECAUSE THE SERVICES THAT I WAS PROVIDING WERE MUCH LESS SO AGAIN. AND SOME FOLKS ARE RELATING THIS TO WHAT WE SAW EVEN IN THE TRAVEL INDUSTRY. YOU KNOW, WHEN YOU HAD, UH, ONLINE BROKERAGES REALLY BECOMING POPULAR, LIKE KAYAK, UM, AND EXPEDIA, HOW DOES THAT TRANSLATE INTO WHAT WE MIGHT SEE DOWN THE LINE FOR THE REAL ESTATE MARKET? WELL, THE REALITY IS THOSE ONLINE BROKERAGES HAVE ACTUALLY BEEN BRICK AND MORTAR BEFORE, TOO. YEAH. UM, THESE BUSINESS MODELS HAVE COME AND GONE WITH DIFFERENT TYPES OF ECONOMIES, BUYERS, MARKETS, SELLER’S MARKET REALLY IT COMES DOWN TO INGENUITY IN ANY TYPE OF MARKET THAT WE’RE ACTUALLY CURRENTLY IN RIGHT NOW. IT’S A SELLER’S MARKET. YEAH. EVERYBODY BELIEVES THAT THE AGENTS MAKE TOO MUCH MONEY, BUT WE’RE PUTTING A LOT OF TIME AND EFFORT INTO IT. I THINK BOTTOM LINE, FOLKS ARE GOING TO START WONDERING, AND BECAUSE THE IDEA IS BEING KICKED AROUND WITH THIS SETTLEMENT, ARE PEOPLE GOING TO START PAYING MAYBE EVEN LESS FOR HOMES UP FRONT? I DO NOT THINK THAT IT’S GOING TO BE THE CASE, HONESTLY, BECAUSE THE HOME HAS TO SELL. IT’S THERE’S NO MAGIC SWITCH THAT’S GOING TO FLIP THAT SAYS, OH, OKAY, THE BUYER IS GOING TO PAY THEIR BROKERAGE TO HAVE INDIVIDUAL REPRESENTATION. UM, AND THEN SUDDENLY THE SELLER IS GOING TO REDUCE THEIR HOUSING PRICE BY THAT. NO, THEY’RE JUST GOING TO KEEP THE EXTRA MONEY. OKAY. ALL RIGHT. AGAIN, VERY FLUID SITUATION. ALL THIS LAWSUIT WAS JUST SET OVER LAST FRIDAY. AND I THINK IT STILL HAS TO GET SIGNED OFF. IT’S A PROPOSED SETTLEMENT AT THIS POINT. YES. THERE CAN BE LOTS OF OBJECTIONS TO IT. THERE CAN BE LOTS OF REBUTTAL AND IT COMES DOWN TO THE FEDERAL JUDGE SAYING, YES, THIS IS AN ACCEPTABLE SETTLEMENT. ALL RIGHT. SHERRY, THANK YOU SO MUCH FOR COMING IN AND DISCUSSING THIS. AGAIN, VERY FLUID AND VERY

Sacramento realtor president reacts to National Association of Realtors settlement

A landmark settlement could make buying that first home cheaper.The National Association of Realtors is settling a series of lawsuits worth $415 million aimed at eliminating the association’s rules on real estate agents’ commissions.According to these lawsuits, homeowners argued that rules set by the association forced them to pay excessive fees for houses.”Everyone’s reaction will be a collective gasp,” said Cherie Hunt, the 2023 president of the Sacramento Association of Realtors. “I don’t believe it will materially change. It’s always been a negotiable situation .However, there is speculation on whether the settlement will have a ripple effect on creating new standards across the industry.Part of the settlement includes banning the NAR from establishing rules that allow seller’s agents to set compensation for buyer’s agents.The settlement also eliminates the requirement for agents to subscribe to multiple listing services to receive compensation for selling a home.To hear more from the interview, watch the video above.See more coverage of top California stories here | Download our app.

SACRAMENTO, Calif. —

A landmark settlement could make buying that first home cheaper.

The National Association of Realtors is settling a series of lawsuits worth $415 million aimed at eliminating the association’s rules on real estate agents’ commissions.

According to these lawsuits, homeowners argued that rules set by the association forced them to pay excessive fees for houses.

“Everyone’s reaction will be a collective gasp,” said Cherie Hunt, the 2023 president of the Sacramento Association of Realtors. “I don’t believe it will materially change. It’s always been a negotiable situation [when it comes to commission fees].

However, there is speculation on whether the settlement will have a ripple effect on creating new standards across the industry.

Part of the settlement includes banning the NAR from establishing rules that allow seller’s agents to set compensation for buyer’s agents.

The settlement also eliminates the requirement for agents to subscribe to multiple listing services to receive compensation for selling a home.

To hear more from the interview, watch the video above.

See more coverage of top California stories here | Download our app.