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Summary: The NWMLS in WA State recently made several changes which impact the real estate marketplace in WA. This article describes in detail what these changes are and how they affect brokers, sellers and buyers.
The real estate marketplace is a constantly evolving, rapidly changing place. Real estate agents and brokers are constantly changing and updating their tactics and skills in order to better conduct business. And real estate laws and rules are also regularly being changed to better serve the industry.
In the State of Washington, the Northwest Multiple Listing Service (or NWMLS) recently updated how real estate broker commissions can appear on home listings. The changes were officially announced on July 22, 2019, and took effect on October 1, 2019.
These changes will increase the level of transparency and flexibility in real estate transactions in the WA State marketplace. Among a few other things, the changes allow the broker’s firm (the firm representing the buyer) to publish how much the seller is offering the broker in commission on its public website and on the WA home listing.
In this post, we will provide a full description of the changes which took effect on October 1, 2019, by the NWMLS which impact the WA state marketplace. Then, we will discuss in detail how these changes help increase transparency and then emphasize the importance of transparency in the modern real estate marketplace.
We encourage you to reach out to Sammamish Mortgage for additional education. The mortgage professionals at Sammamish Mortgage have expert knowledge of the industry and work hard to stay on top of any and all changes which take place. This is why you can benefit by reaching out to our professionals for more information.
To recap, we will go over the following:
- NWMLS makes rule changes
- Rule changes help improve transparency
- Transparency is increasingly important in the marketplace
NWMLS Makes Important Rule Changes on October 1, 2019
As mentioned, one of the changes which the NWMLS implemented relates to the disclosure of real estate broker commission. Now, broker’s firms may disclose the real estate broker commission offered by the seller on their public websites and on the WA state home listing.
Broker’s firms were already able to publish other information about the property for sale, including square footage, bedrooms, bathrooms, and other important details. Now, they will be able to include the commission offered to the buyer’s broker (referred to as the SOC, or selling office commission).
What’s more, the changes also remove the requirement that home sellers must offer a real estate broker commission to the buyer’s broker. Now, in cases in which the seller doesn’t offer a set commission to the buyer’s broker, the buyer and the buyer’s broker may negotiate compensation as a part of the offer to purchase. Again, these changes were announced in July, 2019 but took effect on the 1st of October, 2019.
Rule Changes Help Increase Transparency
The change which allows firms to disclose real estate broker commissions on their public websites and Washington home listings does a lot to increase transparency in the marketplace. Now, buyers and the brokers who represent home buyers will know well in advance about the compensation structure underlying a transaction.
This allows buyers and brokers to be better prepared, and this enhanced preparation will create an overall smoother transaction process. Having this information available publicly will also make it easier for agents and mortgage brokers to explain the benefits of their services. Sellers often offer brokers sizable commissions, and so brokers will have greater incentive to promote and elucidate the value of their services. All of this, in turn, promotes healthy competition within the real estate brokerage industry.
Transparency is Increasingly Important in the Marketplace
As stated directly by the CEO of the NWMLS, Tom Hurdelbrink, transparency is something desired by everyone in the real estate marketplace: sellers, buyers, agents, and brokers. More openness means that sellers and buyers can make better-informed decisions, and this produces a more equitable marketplace characterized by healthy competition.
The CEO of Redfin, Glenn Kelman, reiterated this sentiment when he commented on the new changes made by the NWMLS. Given the rise of the internet and public websites, sellers and buyers want the information to be as available and searchable as possible. Given the financial stakes involved in the real estate industry, sellers and buyers are perfectly justified in this attitude.
A home is usually one of the largest, most significant purchases a person will make in his or her lifetime, and so it makes sense that all involved parties want full transparency and flexibility.
As mentioned, the real estate industry is a constantly changing place, just as is the case with the market itself. Hopefully, the industry will be improved with these new changes made by the NWMLS. To the uninitiated, the real estate industry and the market can seem overwhelming in their complexity. This is why it can be useful to reach out to an experienced mortgage professional.
Reach Out to Sammamish Mortgage for Additional Information
At Sammamish Mortgage, we have mortgage professionals who can help walk you through the home buying process. We have been around since 1992 and are proud to provide quality mortgage loans to customers in WA, OR, ID and CO. Contact us to learn more, or View Rates right now to see current mortgage rates. You can also get a Rate Quote, or Apply Now and use our online mortgage application system to expedite the application process.