The biggest purchase of a person ’ s life for the average American is their primary home where they live . Later in life , the equity in this same owneroccupied home will likely represent the bulk of the homeowner ’ s entire net worth .
A wise purchase can make you very wealthy , while an unwise purchase can be financially devastating . Would you prefer to take this risk alone or with a team of experienced professionals by your side ?
How many of you have seen how thick a real estate purchase and mortgage file can be at the time of closing ? I ’ ve seen files for residential or commercial real estate loans that were three , six , twelve , and twentyfour plus inches thick by the time of closing . Could you imagine handling the closing of a purchase transaction without the expert assistance provided by real estate licensees , mortgage brokers , loan processors , underwriting teams , escrow , title insurance , appraisers , home inspectors , and several others ?
As a result of the recent $ 418 million dollar antimonopoly lawsuit settlement that the National Association of Realtors ® ( NAR ) approved , let ' s take a closer look at how these new buyer agency relationship regulations may directly impact you as a buyer or seller .
The potential reduction of brokerage commissions
The potential elimination of buyer ' s agents from a larger percentage of future sales transactions will obviously hurt many real estate licensees . Prior to this NAR settlement , the average commission paid per real estate transaction was about 5.5 %. It can be split evenly at 2.75 % to the listing agent and 2.75 % to the buyer ’ s
agent or with more of the commission split going to the listing agent such as 3 % for list agent and 2.5 % for the buyer ’ s agent . Will future commission splits fall to lower amounts ?
There are upwards of 1.5 million Realtors ® who belong to NAR and about 500,000 additional real estate licensees who don ' t belong to NAR for a grand total of nearly 2 million real estate licensees .
Upwards of 80 % of real estate licensees ( about 1.6 million ) own at least one home . With the future loss of income from discounted or eliminated buyer ' s brokerage fees , many of these real estate licensees may be forced to list their home for sale while pushing the national home listing inventory rates higher .
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