Historically, buyer brokerages were compensated by the listing broker. Seller paid listing broker and listing broker shared the commission with buyer's broker. The amount or percentage was reflected in the MLS (Multiple Listing Service) typically administered by a regionally designated real esate board/orgniization.
As of Aug. 17, the
buyer is responsible for compensating their own broker and seller is responsible for compensating their own broker as well. There is no longer broker to broker compensation, and the MLS no longer reflects any compensation information.
Buyer will have a BRBC (
Buyer Representation Broker Compensation Agreement) with their brokerage prior to viewing the seller's property. The agreement not only outlines the roles and responsiblities of the buyer and their broker, but also states how much buyer is willing to pay their broker for the associated services.
When a buyer makes an offer on a home, the buyer may
also ask for seller to compensate the buyer's broker. The amount the buyer asks seller to pay cannot be more than what buyer and buyer broker have agreed to via BRBC (Buyer Representation Broker Compensation Agreement). The entire offer is negotiable giving the seller the opportunity to negotiate all aspects of the offer including the buyer broker compensation. The buyer will be responsible for paying their broker the difference between what seller agrees to pay (negotiated amount) and what the buyer has agreed to pay per the BRBC (Buyer Representation Broker Compensation Agreement).
Sellers should consider....
- Pricing the property with or without compensation in mind.
- Whether the seller wants the listing agent to advertise in non-MLS (not allowed in MLS) forms (company website, agent website, flyers) that seller is willing to consider offers that include buyer compensation.
