Touring homes now requires contract with buyer’s agent

JOHNSON CITY, Tenn. (WJHL) — Potential home buyers now have to go through an extra step before touring homes with an agent—sitting down to work out a representation agreement.

The change is amid a series of new practices required by a settlement that ended a lawsuit against the National Association of Realtors .

Local real estate agent Maria Lovelady said she’s already seen the impact, just days into the settlements’ effective date.

“I was at an open house yesterday and somebody wanted to see the house right across the street,” Griffin Home Group sales partner Maria Lovelady told News Channel 11. “We literally had to pull an agreement in the moment. I pulled it up on my laptop, emailed it to them and they signed right there on the spot.”

On top of requiring buyers to sign a representation agreement with their agent, the settlement changes the way buyers, sellers and their agents negotiate commission. Before the settlement, it was standard for sellers to pay commissions to both buyers’ and sellers’ agents out of the profits. Agents could advertise their desired commission rate through the Multiple Listing Service (MLS), a practice that is now banned.

Griffin Home Group Team Leader Jim Griffin told News Channel 11 those changes will raise the level of professionalism in the real estate business.

“It’s going to step up the game a little bit, make it to where the agents on both sides of the table, whether the work is listing clients or with buyers, have to actually provide some professional value,” Griffin said.

Griffin said the extra paperwork does not seem to be putting a damper on the market so far.

“It’s early to see kind of what kind of impact that’s going to be, but overall, it hasn’t slowed anything down, that’s for sure,” Griffin said.

Northeast Tennessee Association of Realtors President Michelle Davis agreed that the changes likely won’t impact pricing in the market. Rather, she said, the new practices will increase transparency.

“Any time that you can have a better dialect with your client and give more options, I think is a good thing,” Davis said. “In the long run, we want what’s best for our clients.”

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