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It’s hard to get a large group of real estate agents to agree on anything — but about this topic, they tell a pretty consistent story.
Prior to the NAR settlement, the practice of agents “steering” buyers away from listings that offered a low buyer commission was always rare. Many agents go so far as to say that regardless of the ethics involved, it wouldn’t have even been worth an agent’s time.
But with new NAR settlement rules set to go into effect later this week in MLSs across the U.S., an industry consensus has emerged that so-called “steering” is primed to become much more prevalent — even as it’s guided more by buyers than by agents.
- Fewer than 13 percent of agents who responded in late July to the Inman Intel Index said that the MLS disclosure of a listing’s buyer-side compensation offer has “occasionally influenced” their advice to clients.
- Of that relatively small group, more than half said they simply passed the commission information on to their buyer clients and let them make a decision.
- Only 5 percent of all agents said they had ever engaged in an activity that resembled covert “steering” — such as acting off the MLS info to not share a listing with a client, or to discourage them from offering on a home.
In its monthly survey of 611 real estate professionals, Intel set out to investigate the true prevalence of steering, how steering has actually influenced agent relationships with clients, and how agents and brokers say the practice is likely to play out going forward under the new NAR settlement rules.
Read the analysis below for the full range of findings.
What ‘steering’ actually looks like
By Saturday, MLSs across the country will no longer include a compensation field on listings, removing the go-to place where buyer’s agents used to be able to confirm their commission.
To understand what this change might mean for agents, Intel first sought to learn what agents say they gained from the field.
When working with buyers over the course of your real estate career, have you regularly checked the MLS to confirm a listing’s buyer-side compensation?
- 61 percent — Yes, but it has never influenced how I advise my clients
- 23 percent — No, I have felt there is no need to check
- 13 percent — Yes, and it has occasionally influenced how I advise my clients
- 3 percent — No, I have felt that it would be wrong to check
We see that a large majority of agents — nearly 3 in 4 — say they would regularly check the compensation field in the MLS. At the same time, very few — only 1 in 20 — said they used this info to steer clients without their knowledge.
So what value did agents gain by having an MLS compensation field?
Agents gave a long list of answers, often selecting multiple options. Here were some of the top-selected choices among all agents.
- 39 percent of agent respondents told Intel that having a compensation field on the MLS reduced the need to reach out to listing agents for the same info.
- 21 percent of agents said it helped them understand how different brokerages approach commissions.
- 20 percent of agents said the compensation field better helped them track changes in the market over time.
- 19 percent of agents said that it helped them better understand their business’s near-term revenue outlook.
Among agents who said they do not routinely check the MLS for a listing’s commission info, here were some of the top reasons why.
- 13 percent of all agents said they did not check because knowing the buyer-side commission “doesn’t help me serve my client.”
- 7 percent of all agents said it doesn’t matter to them whether the buyer-side commission is 2 percent, 3 percent or something else altogether.
- 5 percent of agents said that the amount that the seller covers is so standard in their market that they didn’t feel the need to check.
Interestingly, among the small group of agents who said that they didn’t check the MLS compensation field for purely ethical reasons, almost all believe that the NAR settlement will make steering more prevalent in the future, not less.
One agent, replying anonymously to the survey, described the new conditions as “horrible for buyers” and the agents working with them.
“Much more steering will happen, at the direction of the buyer of course,” the agent wrote. “I actually have not heard of any steering in the past due to amount of commission being offered — ever. Now, with the buyer directing to do so, it will happen every day.”
To illustrate why that might be, Intel asked agents and brokers how they plan to confirm this information in the new environment.
A framework for the future
So after Saturday’s change goes into effect, what will steering actually look like?
In the immediate term, buyer agency agreements appear to be the new standard. And if a seller declines to cover the buyer-side fee, it’s the buyer — not their agent — who will feel the impact.
But this still leaves some questions unanswered. Without an MLS compensation field, how will agents confirm what the seller is willing to cover, if anything?
Brokers have largely settled on one of two main paths in their brokerage policy or guidelines:
- 43 percent of brokerage leaders surveyed in late July by Intel said their buyer’s agents will be encouraged to reach out to the listing agent before their client offers on a home.
- Meanwhile, 24 percent of brokerage leaders have recommended a less direct route: submitting an offer that stipulates the seller will cover the full commission, then learning the seller’s position as part of normal negotiations.
It should be noted that as of late July, just weeks before the change was set to go into effect, nearly 1 in 5 brokerage leaders told Intel they were still waiting on more information before establishing a policy or guidelines on how buyer’s agents should confirm the seller’s commission concession.
One potential solution that has been discussed by some MLSs has been to include a “seller-concession field” where the seller could telegraph their openness to covering all or part of the commission.
But most real estate agents Intel surveyed aren’t yet counting on this being a viable option — at least so far.
After the buyer-side commission is no longer included in a compensation field on MLS listings, how do you plan to confirm this information for future listings?
- 60 percent — I plan to reach out to the listing agent to confirm the buyer-side commission before my client offers on a home, when possible
- 24 percent — I plan to encourage my clients to submit an offer that requires the seller to cover my full buyer-side commission, then learn the seller’s position as part of normal negotiations
- 4 percent — I do not plan to contact the agent for this information, but I will review the MLS listing for other indications of willingness to cover the buyer-side commission, potentially in a seller-concession field
- 1 percent — I do not plan to reach out to the listing agent or encourage my buyer clients to ask the seller to cover the buyer-side commission
- 10 percent — Other
It’s clear that under the new rules, most buyer’s agents will feel the need to confirm the portion of their commission the seller is willing to cover — even if they didn’t feel the need to look it up before, when it was available on the MLS.
And according to the July survey, agents expect this to largely play out off the MLS — not through a seller-concession field or other workaround.
Methodology notes: This month’s Inman Intel Index survey was conducted July 22-Aug. 5, 2024, and received 611 responses. The entire Inman reader community was invited to participate, and a rotating, randomized selection of community members was prompted to participate by email. Users responded to a series of questions related to their self-identified corner of the real estate industry — including real estate agents, brokerage leaders, lenders and proptech entrepreneurs. Results reflect the opinions of the engaged Inman community, which may not always match those of the broader real estate industry. This survey is conducted monthly.
