F
or many consumers, buying a car and a home are two of the most dreaded transactions. Both often involve financing and uncertainty about costs. Unlike other consumer purchases, such as shoes or haircuts, where prices are fixed, real estate transactions have traditionally been opaque. However, this changed in 2024 when a federal court ruling led to a $980 million settlement against several major real estate firms for allegedly overcharging clients.

    The new rules aim to provide consumers with more transparency and control over costs. Key changes include:

    • Realtors must meet with prospective clients to explain the transaction process, their responsibilities, and costs.

    • Before showing homes, buyers must sign a contract outlining services provided, contract length, and potential costs if a sale is finalized.

    • Realtors can no longer access commission information through the Multiple Listing Service (MLS).

    Tiea Vincent, owner of NXT Level Realty, acknowledges that change can be difficult. "We don't like to learn new tricks," she said. However, preparing for these changes has been a challenge. Berkshire Hathaway HomeServices Florida Network Realty President Ann King offered her 500 agents a comprehensive seminar on the new rules.

    The single agent system now requires sellers' and buyers' agents to prioritize their clients' interests separately. This change means that buyers may need to pay their agent's fee, which can be a surprise for some. Memory Hopkins of Memory Hopkins Real Estate notes that traditionally, sellers paid both agents' fees, but this new system allows costs to be divided between parties.

    Sellers are still often willing to cover all real estate agent costs, as observed by Vincent. The need for a contract before starting a home search has also caused confusion among clients and agents alike. Andrew Bell of Next Home Endless Summer Realty suggests that agents must now develop their negotiation skills to justify their commission.

    The initial complaints from agents may have been premature, as many are finding the new rules manageable. As Bell notes, "Until we sit down with the customer and have that conversation, don't work yourself up over it."