Menu Area
Content Divider
Blog Home » General » Report: Many Sellers Still Covering Buyer’s Agent Fee Despite NAR Settlement Changes

Report: Many Sellers Still Covering Buyer’s Agent Fee Despite NAR Settlement Changes

Blog Entry Photo of Report: Many Sellers Still Covering Buyer’s Agent Fee Despite NAR Settlement Changes

The commission changes were expected to occur with the National Association of Realtors’ (NAR) historic settlement have not come to pass in many markets, according to a new report by Redfin (NASDAQ: RDFN).

 

The new report, which is based on interviews with dozens of Redfin agents, found the typical buyer’s agent commission was 2.55%, down slightly from before the settlement was announced. Redfin’s report noted more sellers now that realize commissions are negotiable and seek to get the buyer to cover some or all of the buyside commission. As a result, how much a buyer or seller negotiates will depend on demand for the listing.

 

“We’ve found a tale of two markets,” said Redfin Chief Economist Daryl Fairweather. “In slow markets where there’s less demand from homebuyers, like Austin, agents report that most sellers are still willing to pay the buyer’s agent commission to attract buyers, and agent fees are mostly the same as before. In markets with low inventory and robust demand, like San Francisco and Boston, agents report more instances of negotiation around fees, with sellers asking buyers to make their best offer rather than preemptively deciding what they want to offer a buyer’s agent.”

 

Fairweather added, “Now, like the amount of earnest money deposit or including an inspection contingency, the amount the buyer is asking the seller to pay her agent is a term that impacts the strength of the offer. That will likely drive fees down over time.”

 

Redfin’s agents reported there was more downward pressure on buyer’s agent commissions for high-end listings.

 

“Buyers and sellers of luxury homes are more likely to negotiate agent fees, which makes sense because on a $5 million home every half a percent is $25,000,” says Mimi Trieu, a Redfin Premier agent in Silicon Valley. “They want to make sure they are getting value from their agent. My luxury listings aren’t offering a certain buyside commission. If the buyer makes a great offer, they’ll consider paying the buyer’s agent.”

 

And the NAR settlement’s requirement for removing the offer of compensation from the MLS has been replaced with other forms of communications. Redfin found some of its agents in the Dallas and Portland markets have seen instances of “3%” written on a lockbox.

Categories
Recent Posts
20+
Years
Combined Industry Experience - Put Our Expertise to Work for You
Market
Knowledge
Extensive Market Knowledge is the Key to Our Success
Expert
Guidance
We Make Even the Most Complicated Transactions Run Smoothly
Real Estate For SaleMore Info
English EN Spanish ES French FR Italian IT Portuguese PT Russian RU German GER Croatian HR