As this issue of Luxury Home Magazine is being published and distributed, changes are being implemented in the real estate industry affecting the relationship between Realtors™ and Buyers of real property. National headlines have made many predictions, but headlines are designed to attract attention, not report details, and details matter.

On March 15, 2024, the National Association of Realtors™, a voluntary trade organization, announced a proposed settlement agreement to end litigation of claims related to broker commissions. Although the agreement is not scheduled for finalization until November, 2024, it includes 2 important stipulations:

1. Offers of cooperating compensation, if any, may not appear on any Realtor™-owned MLS system.
2. Realtors™ representing Buyers (Consumers) must have a written Buyer Broker Agreement.

Although the first stipulation will require technical modifications to systems that Realtors™ use for sharing information, it does not change the fact that commissions are, and have always been, negotiable. The second stipulation will be much more visible to the public. Florida Statutes, Chapter 475, which contains the laws governing Florida real estate licensees, does not require the use of these agreements, so it will not be a uniform practice. Only members of the National Association of Realtors™ are required to employ this practice, and only for residential purchases—commercial transactions and rentals are not included. A Buyer Broker Agreement may establish a relationship of single agency representation, transactional agency representation, or non-representation between a Buyer and a Broker. These agreements will address the parties’ duties to each other and will clearly identify professional service fees.

Although Florida Statutes do not require this practice, which means they have not been widely used here, many other states do currently require this practice. Florida’s population continues to increase due to relocations from other states, so we anticipate that some Buyers will be very familiar with this practice. As with all best practices of a business, transparency is an important factor in trust, and a better-educated client can make better-educated decisions.

The crafting of an offer to purchase real estate is based upon many factors: property location, property condition, current real estate market conditions, current financial market conditions, current social conditions, and as always, seasonal climates and lifestyle options, among others. Whether a buyer is a first-time homebuyer, or a seasoned homebuyer, consumers want up-to-date information, from trusted sources, with recommendations made by experienced professionals. Transparency in our relationships makes a lot of sense.

This is not the first time significant changes have been made in the practice of real estate sales, and it will not be the last. Although the many beautiful residences highlighted in Luxury Home Magazine feature their luxurious amenities, we are reminded that they are, indeed, homes. Homes house our families, provide safety and security, are where life-long memories are made. Is the addition of a document formalizing a relationship going to change the volume of real estate sales? No, it is not. People buy homes for the aforementioned reasons. Should a Buyer seek clarification about the process of purchasing property and the relationship they will have with a real estate professional? Yes, they should.

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