Buying a House Just Got More Affordable, Thanks to a Brand New Realtor Rule

Hiring a real estate agent has always meant having someone on your side throughout the complex process of buying or selling a home. Traditionally, realtors have guided clients through each step, leveraging their expertise to ensure smooth transactions, but some recent changes to industry rules have made the dynamics of hiring an agent shift significantly.

Starting Aug. 17, 2024, a new rule requires homebuyers to negotiate and pay their real estate agent’s fees upfront. This is a departure from the long-standing practice of sellers covering both agents’ commissions through the sale proceeds.

This change is one result of a court settlement with the National Association of Realtors and gives greater flexibility in how agents are compensated — whether through a traditional percentage of the sale price, a flat fee, or an hourly rate.

While this gives buyers more options, it does add another layer to an already complicated process. Buyers looking to make smart homeowner money moves must still rely on their agents for market insights, property searches, and negotiations, but now, there are limitations to what an agent can share, especially regarding financial advice or certain legal disclosures.

Understanding these new rules and the boundaries of your realtor’s role is crucial as you embark on your home-buying journey. Here’s a closer look at what you need to know and what your realtor may not be able — or willing — to disclose.

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1. Is it in a good school district?

It seems like such a logical, highly valuable question. However, most agents can’t share their opinion of the school district where you’re buying.

An agent may be willing to provide you with information on the public school test scores — if publicly accessible — but they can’t offer opinions or suggest which school has a good or bad reputation.

2. Is this a good neighborhood?

The quality of a neighborhood is very subjective and one that most real estate agents cannot touch. Opinions like that can sway your decision, which means you could blame the agent later if you don’t agree.

3. Is this area safe?

Most home buyers have this question, but agents are limited in how they can answer. They can provide facts, such as government statistics on crime rates in an area, but they cannot tell you if it is a “safe” community.

They can point you in the right direction to finding this information, though, like publicly available databases.

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4. Is this area family-heavy?

A “family-friendly” community may be something you want, or it may be something you want to avoid. In either case, the agent cannot tell you an answer to that question.

That’s because (like many other topics here) it’s a protected bit of information called familial status, which the Fair Housing Act limits agents from sharing.

5. Is this a strongly religious area?

Whether you want to center your life around a religious organization or not, your agent can’t share information with you about the religious makeup of the community.

They can tell you where you can find specific religious organizations, but they cannot tell you that the area is a “heavily Catholic community” or “most people don’t follow a religion here.”

6. What is the racial makeup of this community?

Another protected classification is race. Your real estate agent cannot tell you that the area is “mostly white” or “there are very few people of Hispanic background here.”

The racial makeup of a community may be available through the city’s website or Census Bureau information, but it’s up to you to find it.

7. Is this community a clean one?

While you can certainly drive around to check out how often people cut their grass or keep the hedges trimmed, asking your agent if it’s a “clean” neighborhood isn’t an easy question to answer for many reasons.

You may want to live in a community where people care for their property. But your agent can’t offer an opinion on this question.

8. Find me a neighborhood without any…

That “any” could be anything that falls under these headings. Perhaps you don’t want to live next to someone of color, a specific religion, a specific lifestyle, or so on.

No matter what you don’t want to do, real estate agents cannot steer you in any direction.

Steering you means they cannot seek out a community to show you a home that’s specifically related to these types of inquiries. Even if they don’t outright say it, they cannot offer these types of recommendations.

9. Are there sex offenders in this community?

Local officials can help you here since Megan’s Law requires all sex offenders to register their addresses.

While you can reach out to the local police or look for information online, don’t put it in your realtor's hands to tell you if someone with this type of background is present in an area where you’re planning to buy a home.

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10. Can you advertise my home as “safe”?

When listing a home for sale, you may have plenty of recommendations for what you want your real estate agent to add to the listing.

You’ve never had a break-in or any damage to your home. You may want the agent to let buyers know there are great families in the area with lots of kids. Or you may want the agent to list your home as surrounded by seniors.

But an agent is going to market your home based on professional knowledge and experience, not what you tell him to say about it. After all, that’s why you hire a realtor, right?

11. Can you help me find a home with lots of singles around it?

Many people want to be surrounded by others like them, whether that’s married or single individuals or those that follow a specific lifestyle.

The problem is that it’s a form of discrimination based on marital status, which your agent cannot perpetuate.

12. Will my home’s value increase in the coming year?

You certainly want some insight into what home prices in the area will do, but real estate agents don’t have a magic wand, and they cannot make statements like this.

The reason is easy to see. If you buy a home anticipating the value to rise 10% in the coming years, and that doesn’t happen, you may try to blame the agent for your buying decision.

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13. Can you market my home to young professionals?

There are definitely areas in many communities that attract a very specific demographic, but your agent cannot recommend one area or another to a specific group of people.

He cannot advertise the house to, say, “up-and-coming young professionals” or people who work in the tech industry. That’s a form of discrimination against others.

14. Is this home a good investment?

Buying a home could be a good investment, especially if your home’s value increases over time and you build financial stability from that.

Yet, your agent cannot tell you that buying a home is the “right” or “best” decision for your situation.

Realtors also cannot tell you what to do with your money, including which loan is “best” for you or how to start investing . That’s up to you and your financial advisors to discuss.

15. Which home should I buy?

Home buying is a very personal decision — we all want to avoid throwing money away — but it’s not a decision that people can share.

While your real estate agent may have an opinion, they cannot know which is the best choice for you.

Bottom line

Your realtor should do everything possible to help you find or sell a great home. But, by law, there are some things your realtor can’t tell you.

Being aware of these things puts you in a position to get ahead financially with a good investment. And given that a home is typically the largest investment you’ll make, you want to be an informed investor.

Money tips that can work for everyone

No matter what your bank account balance is, there's always an opportunity to optimize and improve your finances. Here's a quick checklist of things you can look at today.

Focus on paying off your debt . Debt can hold you back from making progress with your overall financial well-being. Aside from cutting expenses, there are tools that can help you pay off debt faster like balance transfer credit cards and debt counseling.

Earning extra income can give you breathing room. If finances are tight, earning some extra money to supplement your income can make a huge difference. A new job is one option to consider, but if you're not ready to make a big change or already retired, a part-time side job could be a better choice.

Cut your expenses. It sounds painful and so not fun, but it doesn't have to be. Take a look at your biggest expenses because that's where you'll probably find the biggest savings. For example, auto insurance rates have been soaring so shopping around for a new insurance company can be the fastest way to cut your bill. Also, look for ways to cut your grocery bill (despite rising inflation).