Starting in August 2024, Arizona’s real estate market introduced a new rule that requires homebuyers to sign an agreement with a real estate agent before touring homes. While some may worry that this change could complicate the buying and selling process, it's important to understand that this new rule isn’t as restrictive or detrimental as it might first appear. In fact, it could bring about positive outcomes for both buyers and sellers, without significantly impacting the market as some might fear.
This stems from a court case involving the National Association of Realtors (NAR), where the main issue was the accusation that realtors set their commission percentages without allowing consumer input in negotiations. As a result of the NAR settlement, the traditional practice of sellers directly offering compensation to both buyer and seller agents in MLS listings will be discontinued nationwide on August 17, 2024. In the Phoenix market, these changes took effect on August 1, 2024. For a quick summary of the settlement, you can find details on the NAR Settlement FAQs webpage. If you prefer a video overview, it’s also available on my YouTube channel.
A Boost for Buyers
The new requirement to sign an agreement with a buyer's agent upfront is actually a step toward improving the homebuying experience. For buyers, this contract sets clear expectations and responsibilities, ensuring they receive dedicated attention and expert guidance throughout their home search. Instead of hindering flexibility, this arrangement clarifies the relationship between the buyer and the agent, making the process more efficient and less stressful.
By formalizing the relationship early on, buyers can trust that their agent is fully committed to finding them the right home. This agreement helps both parties focus on serious prospects and streamlines the home search, which can lead to faster decisions and a smoother path to closing on a home. Far from being a burden, this requirement is designed to enhance the buying experience, ensuring that buyers have a knowledgeable professional by their side every step of the way.
Minimal Impact on Sellers
Sellers, too, might initially worry that this new rule could reduce the number of potential buyers. However, this concern is likely overstated. The requirement for buyers to sign an agreement before touring homes doesn’t significantly limit the buyer pool; rather, it filters out those who aren’t serious about purchasing. This means that when a seller shows their home, they are more likely to be dealing with a buyer who is ready and able to make an offer.
Moreover, by reducing the number of casual lookers, sellers can focus on serious inquiries, leading to fewer disruptions and more meaningful showings. This can actually make the selling process more efficient, potentially speeding up the sale and reducing the likelihood of a deal falling through at the last minute.
Addressing Concerns
While the initial reaction to this rule change might be one of concern, it’s important to view it in context. The requirement for a signed agreement is not about limiting options or creating barriers. Instead, it’s about fostering stronger, more productive relationships between buyers and agents, and ensuring that sellers are dealing with qualified, serious buyers. The impact on the market is unlikely to be as significant as some fear, and the potential benefits—more focused searches, committed agents, and serious buyers—are substantial.
In conclusion, Arizona’s new rule requiring buyers to sign an agreement before touring homes isn’t the drawback it might seem. For buyers, it ensures they have committed professional support. For sellers, it filters out less serious buyers, leading to more efficient showings and potentially quicker sales. Far from disrupting the market, this change could enhance the real estate experience for everyone involved.
Comments