Real estate transaction changes in place in Delaware

MIDDLETOWN — Real estate agent Lisa Johannsen has been in the industry for 30 years and isn’t quite sure how a federal lawsuit settlement will affect residential transactions.

Changes went into effect Aug. 17.

“It’s a work in progress and I’m a little confused whether this is a good thing or a bad thing,” and Ms. Johannsen of Patterson-Schwartz Real Estate.

According to Delaware Association of Realtors president George Thomasson, “The buyer will now be more aware of the compensation their agent earns, as compensation fees will no longer automatically be covered by the seller.

“Buyers may need to negotiate or directly pay their agent’s compensation, giving them more control and transparency in the transaction.

“Buyer agents will have to negotiate their commission directly with their clients rather than relying on the seller to cover it. This could lead to more competitive compensation rates and require clear justification of their value to clients.”

Previously, he said, “Sellers were never required to offer compensation to the buyer’s agent. However, sellers will be having conversations with their listing agent regarding the pros and cons of offering buyer agent compensation.

“Sellers may reduce their transaction costs but risk fewer showings by not offering compensation.”

According to Ms. Johannsen, who operates in the Middletown area, “We have a lot of new agents that are freaking out and the reality is, what I’m telling them is that everything is negotiable, whether it’s the commission, the refrigerator, outside furniture, whatever.

“I think it’s all negotiable.”

The Associated Press reports that earlier this year, the National Association of Realtors and several major real estate brokerages agreed to pay over $950 million to settle federal lawsuits, claiming they forced homeowners to pay inflated commissions to sell their homes.

The industry also agreed to policy changes aimed at creating more transparency around how brokers and agents are paid for their services.

For information, including frequently asked questions, visit www.nar.realtor .