Realtor settlement could change the way homes are bought and sold
BOSTON - The way you buy a home in Massachusetts is about to change dramatically. The standard broker fee will soon be gone.
The National Association of Realtors settled with a group of home sellers for $418 million. The lawsuit argues that broker fees hurt competition and lead to higher costs. If approved by a court, those broker fees are out come mid-July.
Will the realtor settlement lower home prices?
Anthony Lamacchia, owner of Waltham-based Lamacchia Realty, says the settlement news does not come as surprise. Some market experts believe this news could lower homes prices, but Lamacchia disagrees.
"There is absolutely no chance of this lowering home prices. Some of the media that is reporting on that are doing it because they don't understand how things work," Lamacchia said. "Home prices are affected by supply and demand. The realtor commissions have nothing to do with it."
Home sellers could benefit more than buyers after realtor lawsuit settlement
The change could help home sellers, as they will not necessarily have to pay the typical 6% commission fee, but instead negotiate their commissions with agents.
Ian O'Hara has been looking for a home in Massachusetts for the past six months.
"Hopefully it doesn't get pushed to the buyer, right? That's one of the things I was worried about when I first heard about it," he said.
"For buyers, I do have some concern because some buyers may see the news and be fooled into thinking they are better off going at it alone," Lamacchia says. "They may think they have to come out of pocket to pay their broker because now brokers getting paid is getting a little more complicated."
What does the realtor settlement mean for brokers?
This is the big question moving forward, how will brokers be paid for their work, and how will that impact the industry?
"As of July compensation will no longer be the operative in the [multiple listing service] MLS. Realtors are going to have to negotiate it within the offer they make representing a buyer, and it does add some level of complications," Lamacchia said.
O'Hara has already approached the topic with his realtor.
"Now you are not just looking for a home, you are looking to audition brokers and realtors to help you along the way. It seems like an extra step," he said. "I kind of already had the relationship with her already, so I'm not too worried about that."
Lamacchia believes the changes could slow down the industry as realtors try to figure out the best way to charge customers.
"There is undeniably going cause a disruption in the industry. It already has to some extent, but that disruption is occurring and realtors will have to train up," he said.
