A significant shift in the real estate industry is drawing mixed reactions from the professionals most affected. The new commission rules, which took effect on August 17 following a landmark federal court ruling earlier this year, have disrupted a long-standing practice in the industry. Previously, the commission for a home sale was split between the seller’s agent and the buyer’s agent, but now, buyer’s agents must negotiate their commissions directly with their clients—buyers who, until now, never had to pay their agents out of pocket.
A recent Kaplan survey of 300 buyer’s agents sheds light on how the profession is responding to this major change.
Industry reactions: more skepticism than optimism
The survey reveals that most buyer’s agents are not enthusiastic about the new commission structure. Only 20% of those surveyed view the change as a positive development, while a majority—56%—believe it’s a negative shift. The remaining 23% remain neutral. One agent who expressed concern said, “Buyers typically don’t even have enough money for their closing costs, much less now having to pay a buyer’s agent.”
This sentiment reflects a broader worry that the new system may place an additional financial burden on homebuyers, potentially discouraging them from seeking professional representation in their transactions.
Ready or not: agents prepare for a new reality
Despite the widespread apprehension, 72% of the surveyed agents say they feel “prepared” to navigate the new commission landscape. However, 28% admit they are not ready for the change. This confidence, according to Toby Schifsky, Kaplan’s VP of Real Estate Education, may stem from agents’ training and experience in negotiation, though he cautions that the challenges ahead could be more formidable than anticipated.
“Remember that these commission changes were thrust upon buyer’s agents by the courts, not drafted by the grassroots of the industry,” Schifsky said. “The new structure complicates their commission structure and may actually lead to hurting buyers, many of whom may now believe they can’t afford an agent. This adds volatility to an already uncertain housing market.”
Staying the course, but for how long?
The survey also highlights a strong sense of resilience among buyer’s agents. Only 4% of respondents indicated that the new rules might push them to exit the industry. Meanwhile, 66% say they have no intention of leaving, and 30% are undecided. One agent encapsulated the profession’s determination, stating, “In real estate, you face challenges with every transaction. This is just another challenge to maneuver.”
However, the fact that nearly a third of agents are unsure about their future in the industry underscores the uncertainty brought about by the new commission rules.
The road ahead: education and adaptation
In response to the changing landscape, Kaplan has introduced the Buyer Agency Professional (BAP) designation, aimed at equipping agents with the skills needed to succeed under the new system. Schifsky emphasized the importance of education in this new era, noting that the real estate education industry has a responsibility to help agents quickly adapt to these changes.
“The level of professionalism will rise on the buyer’s side of transactions, and it’s going to be a fierce market,” Schifsky said. “This is not business as usual.”
As buyer’s agents brace for the challenges ahead, the real estate market is poised for a period of adjustment, with professionals and clients alike navigating an unfamiliar and potentially more complex landscape.
The post Buyer’s Agents Face Uncertainty as New Commission Rules Take Effect first appeared on The MortgagePoint.
