Winston Salem | Your Listing Agents Directive

 

In real estate, a fiduciary is an agent who has a legal obligation to act in the best interests of their clients, rather than their own. This is known as a fiduciary duty. The National Association of REALTORS® created an acronym to help real estate agents remember the key points of fiduciary duty, which is "OLD CAR": obedience, loyalty, disclosure, confidentiality, accounting, and reasonable care and diligence.

Starting August 17th, buyers will meet with an agent and sign a buyer representation agreement before seeing a property on the MLS, laying out the terms of that engagement including the compensation the agent will be paid for those services. We all know that buyer agent compensation will vary from agent to agent, market to market, company to company, etc. With that in mind, as a listing agent, acting as fiduciary to your seller, why would you in advance of an offer from the buyer, advertise what your seller is willing to pay in buyer agent compensation or concessions, knowing that every buyer's financial situation is different, and what they agreed to pay their buyer's agent might be different as well? You're literally telling a buyer what your seller is willing to give up to make a deal come together in advance of an offer. This "might" make some sense in a buyer's market, but certainly not a "normal" or "seller's market". I bring this up because I've had two lawyers now tell me, breach of fiduciary duty claims could rise against listing agents, if they continue to advertise specific amounts for offers of compensation or concessions in advance of an offer, "potentially" resulting in the seller leaving money on the table.

The best approach going forward for everyone is simply this: "Seller is willing to entertain any and all requests, put it in your offer". Let the offer dictate your response and strategy for putting a deal together with the buyer. If a buyer's agent calls you and asks if your seller is offering compensation or concessions, simply state: "Our seller is willing to entertain any and all requests from your buyer, please just put them in your offer". What if the offer includes amounts significantly less than what your seller was willing to offer in compensation or concessions in advance? Let the buyer request what they want or need to put a deal together. It's a negotiation... LET THEM MAKE THE FIRST MOVE!

Contact me and I will explain this new confusing process.   

Winston Salem Property Management - How often do Owners want to communicate with us

Carolina Living Real Estate and Property Management researches what owners want and tailor our services to match their needs.   Below is a list of questions we answer with our owners.

Rental owners want you to make your relationships with them a priority.

And in a time when competition is steep and rental owners are highly cost-conscious, good communication is crucial in proving your value.

So, how do rental owners want to communicate with you? That’s what we’ll cover in this post.

1. Find Out Which Info Owners Want, and When

First, find out which information your owners want to receive from you, and on what schedule.

Within our survey, rental owners told us they want to receive the following updates from their property management team:

• Updates on renters and vacancies – 55% would like to receive this information as soon as it’s available
• Maintenance and repair records – 49% want this information whenever it’s available, or at least once a month
• Accounting and financial statements – 65% want to receive these on a monthly basis

2. Mix in Personalized Communications

Next, supplement monthly statements with more personal communications.

Many owners told us they appreciate hearing about their properties outside of monthly reports, and in ways that feel more personalized than a standard email.

3. Acknowledge Receipt of Messages

Be sure to acknowledge messages you’ve received, even if you don’t have a solution to share just yet.

In our survey, owners made clear that what matters most to them is knowing you’ve seen their message and have taken action on it, even if you’re still working on a solution.

4. Plan Ahead for Emergencies

Next, establish how your owners would like you to communicate in the event of an emergency.

Email may work for more routine communications, but when an emergency arises, a phone call might be more appropriate.

Winston Salem | Your Real Estate Advisor for Life | Roby Robertson

Anyone can offer a general opinion on a remodeling project or major landscaping job. An advisor with the experience and acumen of a REALTOR® will provide the clarity and direction few others can. All they need to do is ask the client the right questions to get to the perfect solution. They are the trusted friend with your best interest at heart, the wall off which you bounce ideas. REALTORS® don’t know everything, but they know that together, you can accomplish anything with perspective and experience.

 Contact me to gain advise on new Realtor compensation rules.  (see sidebar or call 704-fourfiveone-7051

Carolina Living Real Estate - Our Clients Are Our Focus!

There are two types of real estate firms, 96% are agent focused.   Carolina Living Real Estate is 100 percent client focused!

This article is courtesy of Scott Hoyt.  Scott is someone I respect and used to work with!

The other four percent ( I am being liberal here) are consumer focused. The difference is outcomes, one desires great outcomes for agents, the other creates great outcomes for clients. Want to know what an (out of touch) agent focused company says in the wake of serious changes* in todays real estate market? 

 First some context. 

Buyer Agent commissions are being removed from MLS systems and most listing contracts. A sellers willingness to pay a buyers agent to negotiate against them is no longer listed in the MLS? There are many arguments against sellers paying a buyers agent, but for expediency lets get to the quote: 

"We value agents who show our listings and appreciate the offers made to our sellers through buyer agents. We believe buyer agents deserve to be compensated for the value they bring to their clients. We plan to strongly encourage our sellers to provide for that compensation in their listing terms with us." 

Yes, you read that correctly, a large firm sent that love letter to agents and an agent forwarded it to me. I do not entirely disagree; buyers agents should be compensated appropriately for services rendered, by the buyer. 

They said they will work their sellers for buyers agent commission up front, before seeing the terms of an offer, before the showing. Who do they work for? What email did they send to their clients? 

The same clients they have a fiduciary duty to represent. The same clients who entrusted them to do the right thing. They said our clients will give up a percentage of their sales price before you even ask. 

The brokerage said we do not believe buyers are strong enough to pay their own fees. We will take the low road and enable weak buyers agents that can not prove value to their clients. We are not going to focus on building the most irresistible listings possible. 

Think about what the rest of the process, transaction, sale looks like if this is how they solve problems. Worst part this company is not alone this is more than common. I can and probably will go on forever about what home buyers and sellers should do to get a stronger outcome. 

The next 36 months are going to be awesome! 

*Prior to August 17th Multiple List Services across the country are eliminating the buyer agents compensation from listings. In the past this listing was an easy way for agents to boycott listings that did not pay them enough. 

Now that is not possible, buyers must now sign a form recognizing the costs of their agent and responsibility for payment prior to touring any home. A huge paradigm shift is the way real estate commissions are handled.

Winston Salem | Mortgage Rates Tumble

The 30-year mortgage fell to its lowest level since May 2023, which “should begin to pique buyers interest in making a move” 

Key points:
The fixed-rate 30-year mortgage averaged 6.47% this week, while the 15-year rate dipped to 5.63%. 

Mortgage applications for home purchases remained flat, however, although there was a bump in refinance applications. expected to remain low.

Mortgage interest rates dropped to the lowest level in 15 months this week, so the big question now is whether they've fallen enough to get potential homebuyers off the sidelines.

The 30-year fixed-rate mortgage averaged 6.47% this week, according to the latest Freddie Mac survey. That's down from 6.73% a week ago. The 15-year fixed-rate averaged 5.63%, down from last week's 5.99%.

Will buyer activity start to pick up?

According to experts: The decline in mortgage rates does increase prospective homebuyers' purchasing power and should begin to pique their interest in making a move, 

But so far, falling rates haven't resulted in a surge in mortgage purchase applications, according to the Mortgage Bankers Association, although there was a jump in refinance applications. Homebuyers could be waiting for rates to drop further, said Joel Kan, deputy chief economist at the association.

And that could happen in the second half of the year, but it will be a bumpy ride, said Lisa Sturtevant, chief economist for Bright MLS. Since potential homebuyers didn't jump when rates began falling five weeks ago, they may remain patient.

"Buyers are flexing a bit. While it is most certainly not a buyer's market, it has been a long time since buyers have had this much leverage in the market," Sturtevant said.
Inventory continues to climb

Sellers appear to be watching mortgage rates as well. Redfin reported that new listings are up 5.9% year-over-year, the biggest increase in five weeks.
But that rate of growth might not be enough to shift market dynamics, as supply remains low compared to recent years, said Simonsen.

Real estate is all about location — and timing. The drop in mortgage rates might simply be hitting at the wrong moment for some buyers. Schools are starting up in the coming weeks, and families may be reluctant to switch districts.

"The seller's pace is still very restricted," Simonsen said. "Until we see new listings pick up, we should see a cap on inventory growth."

Thinking of selling?   Contact us to discuss your options in this new environment!

Negotiate dollar-amount commissions, Consumer Watchdog Urges

Contact Carolina Living Real Estate to Discuss Your Real Estate Needs and Navigate these new rules!

The Consumer Federation of America has rolled out new guidance and is discouraging the practice of paying agents based on a percentage of a home’s sale price.

 

Key points:

• As the August deadline for rules changes nears, the CFA is telling buyers and sellers to negotiate compensation and avoid paying a percentage-based fee.
• Consumers should research any agent they’re considering working with by reading reviews and asking about their experience.
• The CFA also advises buyers and sellers to thoroughly review any forms they’re asked to sign and watch out for pitfalls.

While brokerages, MLSs and associations prepare agents for how to discuss upcoming industry practice changes with their clients, the Consumer Federation of America is providing its own guidance for homebuyers and sellers in the lead-up to the August 17 deadline for implementing the rule changes.

Agent pay should be a dollar amount, not a percentage

Per the NAR settlement, agents and brokers must explicitly communicate that commissions are negotiable when starting to work with a client. But the CFA is encouraging consumers to not only negotiate the fee, but to push for a dollar amount instead of a percentage of the home sale.

"The basic reason that the industry has been sued by the U.S. Department of Justice and by private citizens is because for a century, Realtors have colluded to set rates which now typically are five or six percent," CFA researchers wrote. 

While NAR and others in the industry have argued that commissions have always been negotiable, the CFA and the DOJ contend that sellers have been expected to pay "customary" commissions.

"The class action settlement, for the first time, effectively allows buyers to negotiate their agent's compensation."

Buyers should research their agent 

The CFA advises consumers that "selecting a competent, honest agent is more important than ever, especially for buyers." The consumer group has previously highlighted issues with buyer agreements, and some state regulators have determined that buyer agreements shouldn't be required to participate in a home tour. 

Specific recommendations from the CFA include researching agent reviews on the leading portal sites such as Zillow, Realtor.com and Homes.com, and asking if the agent is also a broker or associate broker — which typically means they have more training and experience. 

Additionally, the group tells consumers to pay attention to whether or not their agent has all of their forms prepared and ready at the outset.

Consumers shouldn't sign anything they don't understand

State associations and brokerages are releasing a flurry of forms for agents to start using this month in their day-to-day business relationships with buyers and sellers, but the CFA encourages consumers to thoroughly review these forms before committing to compensate anyone. NAR has also released new guidance for consumers emphasizing the importance of understanding any agreement before signing. 

 In addition to paying close attention to the content of a listing or buyer agreement, the CFA discourages consumers from getting into a dual agency situation, something the group says can compromise the fiduciary relationship for both buyers and sellers. 

 Another buyer-beware: The CFA warns consumers against signing an agreement that "combines listing agent and buyer agent compensation, or any seller contract that requires buyer agent compensation," as this type of form and practice would "violate the spirit" of the new NAR settlement rules.