Real Estate Board of New York to decouple buyer agent commission
The board wrote that this change, which takes effect in January, “represents the future of how residential real estate is transacted.”
- Starting January 1, listing agents will no longer be able to offer or provide compensation to a buy-side agent or search listings by commission level.
- Instead, only sellers can make an offer of compensation, and will be responsible for paying buyer agents directly.
- REBNY said it expects other listing services to follow its lead.
Regardless of the outcome of the landmark commissions lawsuits — including the Sitzer/Burnett trial currently underway in Kansas City — the Real Estate Board of New York has already instituted new rules that will impact buyer agent compensation.
Starting in the new year, listing agents will no longer be able to make an offer of compensation or directly compensate a buyer's agent. Instead, any buyer agent commission or compensation that comes from the seller will have to be negotiated and paid directly by the seller, the organization wrote in a FAQ outlining the changes.
The reason for the change, REBNY said in the post, is that the board anticipates that decoupling the buy-side and listing agent commissions is the natural next step in the evolution of real estate sales.
"The RLS [residential listing service] is always striving to promote transparency and consumer confidence in the residential marketplace," the board wrote. "The RLS also believes that 'decoupling' the buy-side compensation represents the future of how residential real estate is transacted, and expect other listing services to follow this lead."
While the RLS will still display offers of compensation from the seller, the new policies restrict agents from searching and sorting properties by compensation level.
REBNY goes into more detail on additional rules in its Universal Co-Brokerage Agreement. Other changes starting in January include allowing retail or office spaces within a residential building to be listed on the RLS and more clarification for how "Coming Soon" properties are communicated with an owner.
Agents who don't comply with the new rules will be subject to financial penalties, the REBNY FAQ also noted.