NAR Settlement – Message from BCAR
The BCAR Board of Directors understands and is sympathetic and supportive of the member confusion and concerns surrounding the NAR settlement that has made changes to how everyone does business. The lawsuits surrounding these changes were significant and very serious and we fully support and endorse following the terms of the settlement.
We also feel it is important to acknowledge concerns that the Board has regarding this settlement and its long-term affects.
Consumer Concerns
Buyer Agency is in jeopardy. Buyer agency was created to protect buyers and to create a more balanced real estate market. Before the 1990s buyers did not have representation and had to visit multiple offices to see listings. Buyers were struggling with the financial burden of covering closing costs making it difficult or impossible to cover the compensation for agent representation, so buyers worked directly with listing agents. Litigation eventually led to the creation of buyer agency and commission sharing.
Under the terms of the current settlement, first time buyers, workforce housing buyers and other consumers seeking affordable housing may be unable to purchase a home or forced into working with the selling agent directly which is the exact scenario that was the basis for the litigation that started Buyer Agency in the first place.
Member Concerns
Buyers are already choosing more and more to be unrepresented under the new rules, which was the “old way” of brokerage. Additional time and money must be spent by listing agents on marketing, advertising, open houses, and likely showing the property to potential unrepresented buyers. Firms with more listings and or agents will be the direct beneficiaries of this shift to listing agent control of transactions. 86% of the membership nationally is made up of small independent brokerages which will likely feel this impact the most if buyer agency continues to suffer to the benefit of bigger firms and or agents with more listings.
Summary
The BCAR Board of Directors will continue to uphold the directives of the NAR Settlement to ensure that ALL BCAR Members are indemnified from this lawsuit and any future lawsuit of similar nature. The obvious increased responsibility that has been placed on the MLS and Associations as the enforcement bodies for settlement terms that do not serve consumers or the membership as a whole are disappointing. However, BCAR will work diligently to work within the rules to encourage buyer representation and fair competition.