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You may have heard in the news recently about a national class action case involving the real estate industry. I wanted to connect with you and share a few key points I think are important to know.
First, the crux of the case is transparency, specifically around how real estate brokers are compensated. The explanation and messaging related to broker compensation were misguided in a number of instances, and as a result, a number of sellers and buyers in various states across the country did not receive clear communication about how the real estate brokers were compensated in their real estate transactions.
Second, broker commissions are not set nor standard; they are negotiable, and it is not mandatory for a seller to pay a buyer’s broker’s commission. Brokers charge a fee for their services and, like any professional, they discuss their fees, the options for how those fees will be paid as well as any potential positive or negative implications of those options with their clients, hopefully before their clients contract to work with them.
Third, Colorado has been very clear about broker compensation for a very long time. It’s built into our Colorado Real Estate Commission listing and buyer agency agreements. Because of this, there is a natural avenue to discuss broker compensation openly and honestly when brokers review these documents with their clients. And brokers should be reviewing these documents with their clients.
Lastly, on a more personal level, I am all about transparency. When working with my clients, my job is to educate them and help them make informed decisions that are in their best interests throughout the entire real estate process. In every conversation, in every interaction, transparency is essential; I must share everything I know about how things work and what options my clients have – even if they aren’t going to like what I have to say – so that they can make the best decisions for themselves at every turn.
I love my job, and it’s my honor and privilege to work with my amazing clients. It’s not always easy and there’s a tremendous amount of emotionality in this business as clients move through each stage of buying and selling their homes, but I love it when my clients tell me things like “you explained everything so well”, “you were there for me”, “you were on it and you made this easy for me”, and “I knew I could trust you completely”. This is what has driven my professional “why I do this work” for 18 years (and counting!), and I am tremendously grateful to get to do what I do.
You’ll likely see continued coverage of this case with various spins from different points of view over the coming weeks. I am a resource for you for all things residential real estate, and I encourage you to reach out to me with thoughts or questions about the issue of transparency and broker compensation, as well as anything else on your mind.
