As of August 17, 2024, some new legislation is in effect as it pertains to real estate agents, disclosure of commissions, and forms required to be signed before a buyer can even see a house. Here’s a quick 1-2-3 of some fact vs. myth out there.

Myth: Sellers no longer have to pay commission. Buyers now have to pay commission.

Fact: Commission has always been negotiable but traditionally paid from the seller’s proceeds, and this option remains. Buyers pushed for more transparency, feeling that since they are the ones bringing the check, they should know the commission amounts. This led to the class action settlement. New forms now state that the buyer agrees to pay a “professional services fee,” which can be a set amount or percentage. However, this fee doesn’t necessarily come from the buyer; it can still be paid by the seller, which remains the common practice. Before showing a home, agents must disclose the potential fee in a buyer agreement and confirm what’s being offered by the listing agent. In short, while commission costs have always been built into the price, there is now more transparency in how these fees are disclosed and negotiated.

Myth: You don’t have to sign anything just to look at a house.

Fact: Now you do. Buyer agreements have existed for some time but were not typically required until writing an offer. New laws require ALL buyers to sign a buyer agreement before viewing a home listed for sale. While this may seem pressuring, it doesn’t have to be. Agents don’t want to push extra paperwork on you, but new regulations make it necessary. You can sign a buyer agreement for a specific house, day, or week, for example, until you and your agent decide if you’re a good fit for a long-term working relationship. On future tours, your agent can have you sign another agreement. A couple of things to keep in mind: the professional services fee is based on speculation until a specific house is chosen and negotiations begin. Trust your agent to negotiate fairly and transparently, but remember that percentages can vary based on location, price, land vs. house, and other factors. Good communication is key in each negotiation.

Myth: You don’t have to work with one particular agent. You can go around signing multiple different buyer agreements each day or choose to be unrepresented.

Fact: This is technically true, but it’s not practical. If you want to look at multiple homes in one day, do you really want to contact several listing agents, hoping they’re available to show all the houses in a convenient order? Probably not. Also, calling a listing agent means you’re dealing with someone who represents the seller, leaving you without your own representation unless you consent to dual agency, which can be tricky for all parties involved. Choosing to be unrepresented doesn’t give you a financial advantage either. The commission isn’t refunded to you. Most often, your negotiations will end up being the same, or slightly different, than the amount you’d have saved from not having representation. Plus, if you choose not to work with an agent, who will guide you through the contract and negotiation process? I recommend working with an agent who represents your best interests and negotiating an offer that makes sense for you, regardless of commission details.

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Tiffany Hazelwood

Tiffany Hazelwood has a degree in Journalism from the University of Richmond is a full-time Real Estate Broker with Lake Homes Realty, a lake-focused real estate firm, where she serves as the Anchor Agent for the Lake Anna market. She has been a licensed realtor since 2008 and has been specializing in real estate here at the lake since 2016. She has enjoyed writing the real estate section for the Lake Anna Breeze™ since 2019. In her spare time, Tiffany enjoys jet-skiing and boating on the lake, traveling with her boyfriend, Tom, and time with their 3 dogs.