Webinar Registration

The real estate market has undergone significant changes following the National Association of Realtors (NAR) settlement, and it's crucial for financial advisors to understand how these developments will impact clients buying or selling a home. The new regulations around compensation for buyer and seller agents present both challenges and opportunities. Advisors need to be well-versed in these changes to counsel their clients, as called upon, through real estate transactions.

Join real estate professionals Darrell Done and Todd Swanson for a discussion of these important factors:

1. Direct Negotiation of Buyer Agent Compensation

• What to Know: Under the new rules, buyers must negotiate compensation directly with their agents, and this must occur before they begin touring properties.
• Client Impact: Buyers now have to explicitly agree to the compensation they will pay their agent. This shifts the traditional dynamic where the seller typically covers this cost through the sales price. Advisors should help clients assess how these costs affect their overall financial plan.

2. Mandatory Written Buyer Agency Agreements

• What to Know: A written agreement between buyers and their agents is now mandatory before any property showings can take place. This document will outline the scope of the agent’s representation and the terms of compensation.
• Client Impact: Buyers must be clear on the terms of the agreement to avoid surprises during the home-buying process. This may also introduce new legal considerations that could impact decision-making.

3. Increased Transparency in Agent Compensation

• What to Know: Compensation structures will now be more transparent, with a shift towards buyers directly compensating their agents. This changes the traditional model where seller-listed commissions included the buyer's agent fee.
• Client Impact: Buyers must be prepared to shoulder the responsibility of paying their agent, which could increase out-of-pocket costs. This could affect how much house a client can afford or require additional savings for transaction costs.

4. Shifts in Seller Dynamics

• What to Know: The settlement prohibits the listing of buyer agent commissions in the MLS (Multiple Listing Service), which means sellers are no longer implicitly covering this cost.
• Client Impact: Sellers may need to adjust their expectations and strategies when negotiating with buyers. They may need to offer additional incentives to attract buyers who now must bear the cost of their own agent’s compensation.

5. Potential Market Changes

• What to Know: The settlement is expected to disrupt the traditional commission structure, potentially leading to more negotiated rates and varied compensation agreements between buyers, sellers, and agents.
• Client Impact: The real estate market may see more customized commission agreements, making it important for clients to understand the full cost of buying or selling a home. These changes could also influence overall housing affordability.

*CE/CPE Eligible: 1 CE credit is available to FEN Members with these designations: CFP, CLU, ChFC and RICP. CPA members will earn 1 CPE credit. 

Field of Study: Specialized Knowledge

Prerequisites: There are no prerequisites for this session.

Advanced Preparation: None

Program Level: Basic

Delivery Method: Group Internet Based

NASBA Approved

Financial Experts Network (Sponsor Id#: 145173) is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be submitted to the National Registry of CPE Sponsors through its website: www.nasbaregistry.org.