Through My Lens

by Doreen Spagnuolo, LIBOR CEO

This summer at Long Island Board of REALTORS^® (LIBOR) has called to mind a saying often attributed to hockey great Wayne Gretzky, “Skate to where the puck is going to be, not where it has been.”

That notion, of proactive anticipation, has been a guiding principle of LIBOR’s work to ensure that our members have the tools you need to thrive in a post-NAR settlement environment. To that end, we have revised eight LIBOR forms to comply with the August 8, 2024 practice changes required by the settlement.

The updated forms are not only settlement-compliant and protective of our members, they feature simpler, more consumer-friendly language, as recommended by industry experts and consumer groups.

The opportunity (and necessity) to update the forms that support your business is a positive derived from the events of the past year. Yes, a positive. Clarity will inject greater consumer confidence and less room for misunderstanding into transactions. For example, the revised Exclusive Right to Sell Agreement has a clear, upfront statement regarding compensation, “The owner understands and acknowledges that broker compensation is not set by law or by any REALTOR® association or OneKey® MLS and is fully negotiable between owner and the listing broker.”

This protects REALTORS^â and the consumer. Both the new Right to Sell and Buyer Representation Agreement forms also make it clear that buyer broker compensation is still on the table, but is subject to negotiation. The Buyer Representation forms include a space to indicate the fee the buyer agreed to pay for the broker’s services and, states that, upon the buyer’s request, the broker can attempt to collect the fee from the seller as part of the offer.

Most sellers understand that they need to attract qualified buyers to their properties and want help doing so. Savvy buyers understand that the market is highly competitive and that a REALTOR^â delivers critical professional services in a costly, stressful and often complicated scenario.

As you know, the settlement terms also change the way we communicate about broker compensation. Offers are no longer allowed on Multiple Listing Service (MLS) platforms. Sellers can still offer compensation off an MLS and sellers can offer buyer concessions on an MLS (for example—concessions for buyer closing costs).

The other big change, as of August 8, is that buyers with agents using a REALTOR® owned MLS will need to sign a written Buyer Representation Agreement before touring a home. LIBOR’s revised Buyer Representation Agreements are designed to ensure that the buyer understands exactly what services will be provided and at what cost.

There are several other important revised forms, including addenda for in-progress agreements that pre-date August 8. You can choose to use LIBOR’s new forms or not. Please consult with your broker on the question of what forms you should use. But know that LIBOR has carefully considered every word in these new documents with a forward-looking eye toward compliance and member protection.

LIBOR will continue to communicate about these changes. If you didn’t join over 2,000 of your peers for our July 25, 2024, Understanding LIBOR’s New Forms, webinar, click here for a replay. LIBOR has also built a Frequently Asked Questions (FAQ) page where you will find answers to many questions about the practice changes. In the coming weeks, we will also be delivering broker-specific tools and some new information on communicating your value proposition to ease compensation discussions.

Change is undoubtedly disruptive. But, in business, disruption often brings opportunity. If we step back, perhaps there can be opportunity in these changes, too. An opportunity to review how we unhesitatingly articulate our value. An opportunity to refine our negotiation skills. To take stock of how we communicate to the market, engender confidence and differentiate ourselves. These skills are the earmarks of not just good, but truly great REALTORS^®.  And that hasn’t changed at all.