Commission Lawsuits: What's Next?

The real estate broker world has become a litigious space. Many commission lawsuits have overshadowed the industry claiming REALTORS were conspiring to make homeowners pay inflated commissions.

Like dominos, many states began to launch their own commission lawsuits after Missouri awarded $1.8B to the plaintiffs. Shortly after many agents began to talk about how this will affect the industry. It is still too early to say. I am sure this case will make its way through the appeals court delaying the final verdict.

As real estate professionals we make it our responsibility to have an intimate knowledge of local housing trends and national sales stats. We must also be familiar with these court cases. When the dust settles and these cases make good on its intention to throttle agent commissions, the REALTORs who have established strong relationship with their clients through tested service and value will prevail, and those who treated this profession like an ATM will be left finding other employment.

As a real estate broker, I am not casually waiting on the sideline. I will continue to establish my value as a real estate professional with my clients and agents. This attitude will be the biggest difference in navigating not only an uncertain time in housing and financial markets, but the effects of the commission suits.

Considering these suits, a few agents are pioneering new ways to get paid on real estate transactions. Agents are getting back to the basics of buyer presentations to explain what they will do for their clients. I have even seen agents offering tiered service for buying a home. The top-level service would be a “white glove” experience for a percentage of the home price. While others are considering a per-hour service charge, like an attorney fee structure.

Brokers are also experimenting with new economic models for their agents. I believe if agents are pressed to think creatively about how they earn a commission, I should also get creative on how I charge my agents to help them maximize their earning potential. That is why I have crafted 3 membership plans that would benefit most agents. I have open time this week to meet with you and talk about what plan is best for you. Click here to set up a meeting on Zoom.