In light of the National Association of REALTOR®s (NAR) announcement last month ending litigation of claims by home sellers related to broker commissions,1 agents have a unique window of opportunity to solidify and build new relationships with clients anxious to take advantage of changes agreed to by the NAR in connection with the Multiple Listing Service (MLS) cooperative compensation model rule (MLS Model Rule).
In the settlement, the National Association of REALTORS (NAR) has agreed that all NAR controlled Multiple Listing Services (MLS) will no longer offer buyer broker compensation to a buyer’s agent. Adapting your business strategy in the face of this change – which potentially takes effect in July 2024 – is essential to remain competitive in a market that will become even more so.
Preparing for change
To prepare for the changes, here are some tips on how to continue serving residential buyers fairly without undervaluing your work and worth as a buyer agent.
- Improve your negotiating skills. The rule change leaves it open for sellers and buyers to negotiate commissions outside of the MLS platforms, instead of automatically receiving the offered commission from a listing broker. Commissions will be up to you, so now’s the time to sharpen up those negotiating skills. Consider looking into negotiation skills training programs offered by the NAR and many others online.
- Engage in buyer consultations. This is a prime opportunity to build trust with your clients. Transparency is key. Explain the intricacies of the buying process, including how agents (you!) are compensated. Emphasize the value you bring to guiding them through the sales process. Set clear expectations from the beginning to avoid misunderstandings along the way.
- Continue to use listing and buyer agreements. You should have a buyer presentation ready to go at any moment, like your listing presentation. Review your buyer broker agreements and seek training on how to draft one for any situation. For example, they can be for one day, a particular property, or for 10 showings. Talk through the contract carefully and thoroughly answer any questions your client has before you both sign to ensure they understand (1) exactly what services and value you are providing; and (2) importantly, how much you charge.
- Stay informed. Stay on top of changes as they begin to take effect and continue to adapt your business practices accordingly. You can go to www.nar.realtor/the-facts for up-to-date information from the NAR. (We’ll keep you informed here in our blog, too.) Be sure to communicate any changes to your clients in a timely manner, too, to further build trust and assurance in your expertise.
- Appreciate the value you bring to the table. Now is your time to shine by helping clients understand why they should work with you as a trusted advisor and advocate.
- Develop a Unique Selling Proposition (USP): Identify what sets you apart from other agents. Your USP could be your specialized knowledge of a particular neighborhood, your track record of successful negotiations, your commitment to personalized service, or any other distinctive aspect of your approach to real estate.
- Build a Strong Personal Brand: Invest in building a strong personal brand that reflects your values, expertise, and personality. This includes having a professional website, active presence on social media platforms and consistent branding across all communication channels. Share content that showcases your knowledge and passion for real estate, engages with your audience and reinforces your brand identity.
- Offer Exceptional Customer Service: Going above and beyond to exceed client expectations will be more important than ever to demonstrate your commitment to their satisfaction. Prioritize building genuine connections with your clients. Take the time to understand their goals, concerns and preferences, and provide personalized support throughout the buying process. Stay in touch even after the deal is closed and offer assistance whenever needed.
- Add Value and Innovate: In a competitive market, providing added value beyond traditional services can give you a competitive edge. Explore innovative ways to enhance the homebuying experience for your clients, such as virtual property tours, interactive neighborhood maps, or personalized relocation assistance. Provide resources and guidance to help clients make informed decisions, whether it’s finding the right mortgage lender or connecting them with reliable contractors for home renovations. (You can get direct access to resources such as these and more by tapping into the business-building opportunities available through Offerpad’s Agent Partnership Program.)
The good news
While change is always constant and inevitable, especially in real estate, the good news is the fundamentals remain the same: buyers and sellers will continue to have many choices when deciding to buy or sell a home. You’re still going to have buyer representation. (In fact, according to the NAR, 89% of home buyers used a real estate agent or broker to purchase their home last year.2) And you’ll still earn a commission. How much will be up to you.
While we await the final fallout of the NAR settlement, you can differentiate yourself from the competition by adjusting to these changes with a combination of strategic thinking, exceptional service and innovative approaches to running your business.
2 Lautz, Jessica. Top 9 takeaways from NAR’s 2023 Profile of Home Buyers and Sellers. Nov. 13, 2023.
