Believe it or not, this is a very interesting time in the world of real estate! Change is rapidly occuring in the industry. Legal and ethical topics are being challenged in both the court system and the court of public opinion. The implications of those changes will affect the way we do business for many years to come.
As a licensed broker and a Regional Vice President of the Kansas Association of REALTORS, I try to stay as up-to-date as I can on the issues affecting my industry. No need to get lost in the details here. Simply put there are currently two class-action lawsuits involving buyer agent compensation that are set to be litigated in the near future. Whether or not they will be successful remains to be seen. Ditto their effects on the legal and ethical consequences on the day-to-day business of brokers and agents. However, many large REALTOR associations, MLS's, and brokerages are trying to get ahead of the issues. Such is the basis for updating our Showing Policy.
To boil the changes to our policy down to their essence, we will no longer show any MLS-listed property without a Buyer Agency Agreement completed in writing. This agreement spells out our relationship with our client, our duties and obligations, our client's duties and obligations, and how we are compensated for our work. Technically speaking, this change simply brings our policy into compliance with already-on-the-books laws about real estate agency.
For showings on properties in which we are the listing agents, we are re-affirming already-established policies. In the interests of full disclosure and transparency, this policy is necessary for the public to understand who we are representing. In such instances, we are representing the seller and only the seller. Dual agency is not only an ethical minefield, it's illegal in Kansas. Further, we will not allow showings on our listings to unqualified buyers. Potential buyers who are unwilling to meet this minimum standard of service are free to contact a buyer agent of their choosing to assist them in viewing a property.
At R+K Real Estate, we are anticipating large changes in the coming years. The days of the seller paying the entire commission, and the listing agent splitting that commission with a buyer agent may be near their end. What is more likely is that a buyer will pay their agent directly or lending regulations will change to allow the inclusion of buyer agent commissions into the loan principle. What is almost certain will be the removal of the "blanket offer of compensation" to a buyer agent as a requirement of listing a property into an MLS. Agents who work with buyers who are unable to adapt to this change will exit the industry. One can argue one way or the other as to whether or not these changes are beneficial or harmful. Without a doubt transparency in the real estate industry will be enhanced going forward.
Our Showing Policy can be viewed here. I hope that this post has been helpful to anyone curious about change in the industry as a whole or to those that may be wondering why we've implemented these policy changes at this time. By writing this I hope to educate, and also to convey the transparency I believe is lacking in this industry. But above that, I hope to establish how R+K Real Estate values the highest levels of customer service to our clients.
I appreciate anyone taking the time to read this post and I want to invite anyone to reach out should they have any questions about our policies and about real estate topics generally. Home ownership is something we believe in and we hope to make it a reality for anyone who shares our dream!