6.20.24
Good morning,
Recently, I have addressed some of the changes that will occur in the real estate industry due to the lawsuits filed against numerous brokerages and NAR (National Association of Realtors), related to commission collusion.
As things settle and we begin to incorporate some of the expected changes, many of us feel the full transparency coming to our business is welcome. In the end, it is expected not much will change around the actual structure of commissions. Buyers will still want representation and many cannot afford it, or prefer to finance it as part of the transaction and sellers still want as many buyers as possible to be eligible to buy their home. Sellers will be inclined to offer a commission to ensure as many buyers as possible can participate in making an offer and no one is limited by the cost of the commission. Being available to the largest pool of buyers ensures them the highest price. The real change will involve the increased level of diligence and commitment required from the buyers to engage in a process of vetting and choosing representation with a contractual agreement.
One surprising aspect of change that has come to light is the distribution of listing information to the general public. This is still under review, but I have read that agents are no longer allowed to discuss another company's listings with a prospective buyer if that agent does not have a Buyer/Broker representation contract in place with the buyer. For example, if a buyer attends my open house and we discuss my listing, then they say, "This doesn't fit my needs; do you know of any other homes in the area that may interest me?" I am required to respond, "I can tell you about my office's listings, but I cannot discuss other listings from other brokerages in the area because you and I do not have a representation agreement in place."
Details are still coming and processes being evaluated, so stay tuned here as I continue to bring them to light.
DID YOU KNOW?
- Prior to 2018, qualifying households could deduct some or all of their moving expenses from their taxes. After the Tax Cuts and Jobs Act of 2017, this Federal tax deduction is limited to military families. This act expires in 2025. As does the SALT (State & Local Tax), tax deduction limits imposed.
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The Oklahoma City Council on Tuesday gave the green light to plans for a tower that will rise nearly 2,000 feet in Oklahoma’s capital city, dethroning One World Trade Center in Lower Manhattan as the nation’s highest. (NY TIMES)
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The multifamily sector not only rebounded from the lows it experienced last year, but net absorption is more than double that of the same period a year ago. This translates to more than twice of the additional occupied rental units than vacated compared to last April. Nevertheless, even with this strong demand, the vacancy rate remained at 7.8%. This is mainly due to the influx of new rental housing supply entering the market after the record highs in apartment construction over the past couple of years. (NAR)
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What is fiduciary in real estate?
In real estate, fiduciary duties are obligations to act in the best interest of your clients, representing them as you would yourself.
According to the California Department of Real Estate:
"Fiduciary duties include, among others, loyalty; confidentiality; the exercise of utmost care (and in certain fact situations, reasonable care); full and complete disclosure of all material facts; the obligation to account to the principal; the obligation to act fairly and honestly and without fraud or deceit; and the duty to "explain" and "counsel" about that which has been disclosed or should have been disclosed thereby permitting the principal to make an informed and considered decision to buy, sell, lease, exchange, borrow or lend."
Home Sweet Home
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Feral hogs cause approximately $2.5 billion in agricultural damages each year. 35 US states report feral swine presence. Nearly 300 native plant and animal species are in rapid decline because of feral swine, and many of the species are already at risk. They also carry at least 40 parasites, 30 bacterial and viral illnesses, and can infect humans, livestock and other animals with diseases like brucellosis and tuberculosis. Texas, Georgia and Florida are most impacted by this. Wildlife damage to property is not exclusive to hogs: deer and others are a menace to homes around the US. Wildlife damages incurred by metropolitan residents in the U.S. have been estimated at $4.5 billion annually. (USA Today)
- Will A.I. resolve one of the most critical cost issues around construction: speed? Homeowners are experimenting with an explosion of new artificial intelligence applications to quickly visualize an array of layout and style ideas, coordinate with builders and designers and estimate costs. These new tools say they can help save time and money in the building and renovation process, which has traditionally been filled with seemingly endless decisions and an avalanche of paperwork that often result in longer projects and ballooning costs. (WSJ)
Around the World
- And you think US debt is bad? Emerging nations are contending with a staggering $29 trillion in public debt....still lower than the US'. 15 countries are spending more on interest payments than they do on education, according to a new report from the United Nations Conference on Trade and Development; 46 spend more on debt payments than they do on health care. (NY TIMES)
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The IEA expects total global oil production capacity to surge to nearly 114 million barrels per day by 2030 — a whopping 8 million barrels per day above projected global demand.....which could trigger major price declines. (CNBC)
Market Trends
COMPASS Catch
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