Well, there was a new Indiana law that went into effect on July 1, 2024, that affects both buyers and sellers and tenants of residential and commercial real estate in Indiana.
This change largely impacts buyers and tenants and their buyer broker’s requirement to have a signed Buyer’s Exclusive Agency Contract.
In mid-August, we’ll see further changes based on a settlement of a lawsuit with the National Association of Realtors (NAR).
So, what’s the big deal?
One of the terms of the agreement is that NAR agrees to prohibit offers of compensation on the MLS. Offers of compensation can be pursued off the MLS via compensation paid directly by consumers, a concession by the seller, or a portion of the listing broker’s commission, but using the MLS to communicate offers of compensation is no longer an option.
Are buyers still going to ask sellers to pay the compensation for their buyer broker?
The buyer broker may negotiate the seller’s payment of the buyer’s closing costs, including a Buyer’s Exclusive Agency Contract. However, it is important to note that the buyer must request payment of this contractual obligation.
Can sellers still offer buyer brokers bonuses to bring buyers off the MLS?
Yes, they can, but the buyer and buyer broker have a contract they must adhere to or amend to align it with the seller’s offering.
Okay…
So, every buyer who comes through the door of a listing will have a contract that establishes their relationship with their buyer agent and how much that buyer agent will be compensated. The buyer chooses one agent to work on their behalf, much like a seller does with their listing agent. It also says that the buyer’s agent will ask a seller to contribute to that compensation. (“Broker shall use Broker’s best effort to cause the Seller or Sell’s agent to satisfy the Buyer’s obligation to Broker.”)
So, there you have it! Nothing earth-shattering, but definitely new and different from the way we’ve practiced real estate for decades.
Informative! Thank you!