Collusion in the Real Estate Industry?
If you haven't been paying close attention to the real estate industry, you may be unaware of the mounting scrutiny being placed on the decades-old commission model used by real estate agents across our nation. Just recently (October 31st, 2023), a Missouri jury found the National Association of Realtors (NAR), and two large nation-wide brokerages, guilty of colluding to maintain high brokerage commissions and liable for nearly $1.8 billion in damages...a number that is likely to grow significantly as similar lawsuits are raised in other states. It is also worth noting that a couple other large, well-known brokerages settled with plaintiffs earlier this year to the tune of more than $100 million and no longer require their agents to be part of the NAR.
Missouri jury finds Realtors, brokerages guilty of conspiring to inflate commissions.
What does all this mean for you, the consumer? First, in general, changes are coming to the real estate industry that have been LONG overdue. While the changes may not come quickly, they are seemingly becoming more and more inevitable. Traditionally, when a home seller signs a contract with an agent to sell their home, they typically agree to pay a 5-7% commission to the listing agent's broker when their home is sold. That listing agent/broker will list the home for sale AND advertise that they will share the commission with a buyer agent's broker if a buyer agent is involved in the transaction (e.g. typically a 6% fee is split 50/50 so both sides walk away with 3%). A likely outcome from this, and expected future similar lawsuits in other states, will be that the listing agent will no longer be able to essentially lock the seller into paying such a high commission to both sides of the transaction. Instead, the commission amount will be set by the open market to something more reasonable for the service being provided. Further, the listing agent/broker will likely no longer lock the seller into paying for the buyer agent altogether (who is essentially working for the buyer anyway).
It's about time that the best interests of the consumer start becoming the focus! The great news is that FSBOHOMES has already built a system centered around the consumer and is ahead of the curve, so you don't even need to worry about how the agents are structuring their commissions. From assembling a team of professionals who are better qualified in their area of expertise (i.e. local advertising manager, professional photographer, certified home inspector, certified appraiser, and real estate attorney/contract manager) to a Seller Playbook that provides a marketing strategy to get your home sold while preserving as much equity as possible, to a system that brings buyers and sellers together to negotiate and agree on terms in an open and transparent manner...the system does it all!
But don't take my word for it, take a look at all of the success stories and resounding reviews for any of our FSBOHOMES office locations. You'll find multitudes of happy customers that feel great about selling their home in a much more modern and transparent way...that was focused around them instead of lining someone else's pockets.