Let me start today’s column with a full disclosure.  For the last 4 years in addition to my commentaries on Fox 42 TV and now here with the Nebraska Daily Record, I have also been a realtor with Better Homes and Gardens the Good Life Group.   I tell you this, so you’ll know where I’m coming from when I talk about the National Association of Realtors agreement you’ve heard so much about.

This may not be the big benefit for home buyers some of the news stories would have you believe.  In a nutshell what this agreement does is advertise that commissions are negotiable (they always were) and that sellers don’t have to offer a commission to buyers agents but if they do, realtors can no longer promote a sellers agent commission in the MLS. 

The MLS if you don’t know is the service realtors use to let other realtors know of the available homes on the market. It gives more in-depth information about these homes that the buyer’s agent can use to educate their clients. And until the middle of July, it lets the buyers agents know what their compensation will be if a deal is made.

The MLS is also the service that websites like Zillow use to put that information out to the consumers looking for a home.  But without other information the realtors have access to.

When the NAR agreement takes effect, sellers will still be able to compensate the buyers agents if they choose, but the listing agent won’t be able to advertise that compensation in the MLS.   However, if the seller chooses to compensate the buyer’s agent that can still be promoted in other ways such as email blasts and social media ads.

There is no doubt this agreement will have an effect on how people buy and sell their homes.  And there is no doubt that some realtors will fall by the wayside. And when this goes into practice I’m sure there will be unintended consequences people haven’t even thought of yet. 

One thing many news reports have been saying is one thing that won’t happen in my humble opinion.  Home prices are not going to drop.  Home prices have never been determined by a realtor’s commission.  They have been determined by location, the available houses on the market, the condition of the home, and other factors.  A seller is not going to lower the price of their home just because they have decided not to pay the buyers brokerage a commission.  As long as inventory remains tight home prices will remain high.

But just because a payment to the buyer’s brokerage can’t be advertised in the MLS anymore doesn’t mean that that sellers shouldn’t offer it.  Here are two reasons why paying a buyer’s commission is advantageous to the consumers. 

1) The commission incentivizes the buyer’s agents to show your home to their clientele.  There are a couple thousand real estate agents in the area.  The more agents that show your house the better your chances to get top dollar for it.

2) Many buyers, especially first-time home buyers, don’t have a lot of extra money laying around. Having the buyer pay for the agent’s service will put an unnecessary burden on them and could prevent them from getting the home they’ve dreamt of.

Yes, when approved by a judge this new agreement from the NAR will change things.  But I’m not convinced we’ll see the seismic shift in homebuying many are predicting. There will be a little more paperwork, a few more options, there will be winners and losers.  But the way some of the news reports have been sounding you’d think that home prices were going to drop by 50% and that realtors will be providing their services for free.  None of that’s going to happen. 

Personally, I thought the old system worked fine.  I thought it worked fine when I bought and sold my homes before becoming a realtor.

I would have gone with the adage “If it ain’t broke don’t fix it.”  But not everyone felt that way so now we find ourselves having to make these changes.  Will this make things substantially better for the real estate consumer? I’m not so sure. I guess only time will tell.

Tom Becka is a long time Nebraska broadcaster who for over 30 years has been covering Omaha and Midwest issues on both radio and TV. He has been a guest on numerous national cable and news shows, filled in for nationally syndicated talk radio programs and Talkers Magazine has recognized him as one of the Top 100 talk show hosts in the country 10 times. Never afraid to ruffle some feathers, his ‘Becka’s Beat’

Opinions expressed by columnists in The Daily Record are not necessarily those of its management or staff, and do not constitute an endorsement or recommendation. Any errors or omissions should be called to our attention so that they may be corrected. Contact us at news@omahadailyrecord.com. commentaries can be found online on Youtube and other digital platforms.