How Does the Idea of ‘For-Sale-By-Owner’ Change Under the NAR Settlement?
The number of sellers opting to sell without a listing agent was surprisingly low even before the NAR settlement, which will have the effect of cutting in half the commission charged by listing agents thanks to the removal of a co-op commission for buyers’ agents, .
The National Association of Realtors (NAR) has reported that only 7% of homes sold during 2023 were sold without the services of a listing agent. Another 4% of sellers began without an agent but ultimately changed their minds and decided to hire a listing agent.
mission cannot include the offer of compensation to a buyer’s agent, so listing commissions will henceforth be 2.5% to 2.8%, seriously reducing the appeal of trying to sell one’s house without professional assistance.
The main argument for going FSBO (for-sale-by-owner) has been to avoid paying the typical 5 to 6 percent listing commission. But that commission included the 2.5 to 3 percent commission shared with the agent representing the buyer. Under the NAR settlement (if approved by the courts), the listing com-
CEFF Offers 2 Earth Day Films
The Colorado Environmental Film Festival is celebrating Earth Day with two films: The Engine Inside (about bicycling) tonight, April 18; and Deep Rising (about seabed mining) on April 21. Ticket info is at https://ceff.net/earth-day.
In my real estate classes as a new agent at Coldwell Banker back in 2002, it was drummed into us that “listors last,” so we should focus on working with sellers instead of buyers. The NAR settlement has struck a serious blow to anyone who specializes in working with buyers.
In light of this, NAR is offering its Realtor members a free “Accredited Buyer’s Representative” (ABR) course, and, even though Golden Real Estate specializes in working with sellers, all of us have signed up for this course so we can receive the advice which it will offer when representing buyers in the changed landscape of real estate transactions.
Of course, I will share with you what I learn from that course, which I’m taking on June 17th. Hopefully, the court will have confirmed or rejected the NAR settlement by then, so we’ll know for sure what lies ahead.
As I wrote last week, the inevitable
Renovating? Consider Adding a ‘Back Kitchen’
I can’t take credit for this idea. Last year Pro Builder magazine had an article in its May/June issue about new ideas in kitchen design, and one in particular caught my attention: adding a “back/ messy” kitchen.
Nowadays, especially with open floor plans, the kitchen has become a center of entertaining. Guests gather around the host or hostess as they prepare and deliver various courses of food.
A back kitchen allows for dirty dishes to be out of sight immediately. This keeps the kitchen area clean and attractive — and quiet — throughout the evening. There could even be a second dishwasher in the back kitchen.
The back kitchen could also be where prepared courses are staged for bringing out during the party. Think of it as a “butler’s pantry” that is off the kitchen instead of between the kitchen and the dining room.
Most people nowadays have both a walk-in pantry and what’s being called a “Costco closet” for those bulk purchases so many of us are making these days. A larger pantry big enough to satisfy both needs could be attached to the back kitchen instead of the main kitchen, cleaning and simplifying the main kitchen design. Another feature which makes a lot of sense is to have seating on two sides
(adjoining, not opposite) of the kitchen island instead of just one. This facilitates guests talking to each other, while still including whoever is at work on the business side of the island.
Open floor plans typically show the kitchen open to the family room, but not the formal dining room. How about an Lshaped open floor plan in which the dining room is open to the kitchen on the side, with the family room open to it at a 90degree angle?
Here’s a floor plan from Pro Builder showing this concept, in which ‘A’ is the island with 2-sided seating, ‘B’ is the pantry/Costco closet, ‘C’ is the back kitchen, and ‘D’ is a barn door for closing off the back kitchen/pantry.
effect of the NAR settlement will be that many or even most buyers will call listing agents directly instead of hiring an agent to represent them as a buyer. Only time will tell how that process will shake out.
If I worked solely as a buyer’s agent, I would be very nervous about what the future holds for me.
Buyer agents will still be able to earn a commission by selling new homes. Because the new home market is so competitive, builders are unlikely to reduce the commissions they currently offer to agents. Most builders, I have found, offer a 3% commission to agents who bring them a buyer, although that commission is applied to the base price,
not to the price after adding upgrades of flooring, appliances, counters, etc.
The challenge for real estate agents has always been getting buyers to call them before registering at a builder’s sales office, because most builders will not pay agents who did not register along with their buyer. We tell buyers to visit as many new home communities as they wish but not give their names until they are serious and want us to represent them. Then we can go with them on a return visit where they and we register together. That way, the buyer has the advantage of professional representation, and we are compensated for being their agent.
This column and the ’Back Kitchen’ article appeared in last Thursday’s Denver Post.
Real Estate Activity Has Surged Since Jan. 1st
For most of 2023, the number of closed transactions fell while the number of active listings surged until some of them either expired or were taken off the market for the holidays. Starting in January there was a marked increase in sales, combined with more sellers putting their homes on the market.
The charts at right are from Denver’s MLS and cover the 15-month period from January 2023 through March 2024 for REcolorado listings only, limited to a 20mile radius of downtown Denver.
The second chart shows how sharply the median days a listing was active on the MLS rose through most of last year, peaking at over 30 days in January but plummeting, just like last year, in February and March. Meanwhile, the median sold price, which had been slumping slightly during the last half of 2023, turned sharply upward in January, February and March.
From studying current MLS data, this trend is continuing in April.
Of course, the real estate market varies greatly from city to city and from neighborhood to neighborhood. If you’d like to monitor the market in your city or your specific subdivision, any of our broker associates or I could create what we call a “Neighborhood Alert” for you. You define the area you want to monitor, and we pro-
Active Listings
Median Sold Price
Median Days in MLS
Closed Listings
gram the MLS to send you an email notification every time a home in that area is listed, goes under contract, sells or expires. With our help, you’ll be the neighborhood expert where you live — or perhaps in a neighborhood where you want to buy. Call us; our phone numbers are below.
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285 Hustler 9 April 18, 2024 Crossword Solution Solution © 2016 King Features Synd., Inc. NEVER WILL I EVER... BY MARC VARGAS • ZAZ@CAMPVARGAS.COM
TRIVIA
1. MOVIES: Which dramatic lm features the character “V”?
2. GEOGRAPHY: Luzon belongs to which island nation?
3. LANGUAGE: What is the Latin phrase for “before the war”?
4. U.S. STATES: Which state has the most national parks?
5. LITERATURE: Which 1950s novel includes the line, “Nothing behind me, everything ahead of me, as is ever so on the road.”
6. CHEMISTRY: What kind of gas makes a drink bubbly?
7. TELEVISION: Which sitcom features a mom named Debra Barone?
8. MUSIC: What was the former name of the English band Muse?
9. SCIENCE: What are the gaps between nerve cells called?
10. THEATER: Who wrote the play “ e Crucible”?
Answers
1. “V for Vendetta” (2005).
2. e Philippines.
3. Antebellum.
4. California, with nine.
5. “On the Road” by Jack Kerouac.
6. Carbon dioxide.
7. “Everybody Loves Raymond.”
8. Rocket Baby Dolls.
9. Synapses.
10. Arthur Miller.
(c) 2024 King Features Synd., Inc.
FLASHBACK
1. Which group had a hit with “Rock and Roll Is Here to Stay”?
2. How much did the Beatles earn for their appearances on “ e Ed Sullivan Show” in 1964?
3. Which artist was literally a one-man band?
4. Who sang the theme song in the lm “What’s New Pussycat”?
5. Name the song that contains this lyric: “I don’t know what he does to make you cry, But I’ll be there to make you smile.”
Answers
1. Danny & the Juniors, in 1958. ey were originally known as the Juvenaires, until DJ Dick Clark suggested a name change.
2. ey earned $2,400 for each of three performances. at’s worth about $24,000 today.
3. Trent Reznor. He could play all the instruments but would temporarily hire other musicians while on tour to play with him under the name Nine Inch Nails. He must be doing
something right because he’s netted 13 Grammy nominations.
4. Tom Jones, in 1965. It was nominated for an Academy Award in 1966 for Best Original Song.
5. “All I Have to Give,” by the Backstreet Boys in 1998. e song reached Top Ten charts around the globe, topping charts in Spain, Hungary and Zimbabwe, of all places. It only reached No. 5 in the U.S.
(c) 2024 King Features Syndicate
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