For weeks, the eyes of real estate agents and executives were on Sitzer | Barnett trial. They shared their thoughts and concerns as part of Intel’s monthly real estate sentiment survey.
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Real estate industry leaders, take note. Agents are more nervous about these lawsuits than you are. And their customers have no idea what’s going to happen.
A survey of more than 1,200 real estate professionals conducted by Intel in the days leading up to Sitzer | The Barnett ruling in October revealed growing unrest within real estate agencies. 1 in 5 agents and 1 in 7 are executives and decision makers They currently consider litigation to be their number one business concern.
In the week before the verdict, 91 percent of agents said they were at least monitoring the clinical trial. “sometimes,” and 26 percent Chase “every day.” When asked how often brokers monitored trials, they responded: 90 percent Number of agents who said at least that. “sometimes,” meanwhile 35 percent Said “every day.”
These findings, released this week as part of the Inman Intel Index (Triple I), show that concerns about the fallout from litigation are now a strong No. 3 concern for both groups, with rising mortgage rates It has become clear that this is second only to the housing shortage. Inventory for sale.
Here’s what these agents and executives told Intel and how some leaders are starting to prepare.
- a The majority of real estate professionals Intel’s research predicts that the number of agencies will decline “significantly” once the full impact of the Commission litigation is felt.
- 51% of general agents We expect that cooperative reward practices will become voluntary and that their numbers will decline as a result.almost 7 percent A growing number of people believe that co-op fees will be completely banned and a significant number of agents will be forced out of the market.
- Brokerage owners, proptech founders, and other real estate executives was more optimistic.almost 28 percent One of these decision makers told Intel that he expects cooperation rewards to become an option, but that the impact on agent numbers will be minimal.only 20 percent of agents shared this perspective.
- Even before the jury sided with the home sale plaintiffs in Sitzer. Barnett said real estate professionals could read the writing on the wall.only 10 percent A percentage of executives expected NAR and the remaining brokerages to win or secure a settlement favorable to their business practices. 14 percent agents fell into this same optimistic camp.
Despite the growing anxiety gripping the real estate industry, agents report that the lawsuits are just starting to trickle into the consciousness of their clients.
- 93 percent of agents reported that their buyer clients rarely mentioned litigation. 92 percent of agents gave similar answers for sales customers.
hold it together
Good news for brokers: Agents typically believe in their broker’s business model. And many of them truly love where they work.
- Agents who responded to the survey were most likely to be listed. Corporate culture as the most important thing in the securities companies they trade with.
- that’s all 30 percent Number of agents who selected culture 24 percent Choose brand recognition instead, 21 percent Select Technology and Education.only 15 percent We have listed the fee structure.
- Although they may have less time, agents are generally confident in their brokerage’s business model. They give the brokerage the following scores: 4.3 (out of 5) on average.
Still, agency and brokerage leaders alike are concerned.
- Chief among these concerns are: mortgage interest rate and lack housing stock. one third of agents and real estate leaders cited fees, and a similar number cited lack of properties as their top concern.
- But even before the jury reached a verdict on Sitzer, Barnett Aftermath of the Commission litigation It was already one of the biggest business concerns for real estate professionals. 20 percent with agent 15 percent of brokerage leaders said litigation was at the top of their concerns.
- among a group of brokerage owners, real estate managers, and investors. 11 percent They said they were most concerned about that Compensated compression. This is double the percentage of agents who said the same thing.
- Fewer 4 percent of agents said they were most concerned about technology devaluing or replacing the services they provided.
The last word
In each of the first two editions of the Inman Intel Index, real estate industry leaders said they were closely evaluating their indexes. buyer’s contract When the Commission’s case goes through the courts.Many leaders said Communication with agentsprovides information about the lawsuit and its possible impact.
Below are some of the specific steps leaders in the securities, MLS, and proptech worlds told Intel they are taking to prepare for a post-Sitzer situation.
- “Communicate their value to members and educate them to start using buyer/broker agreements.”
- “We will focus on listing and establishing a niche market for that listing.”
- “I’ve told my agents. I’m an MLS director and I’m starting to make plans. I’m making my agents work hard. [their sphere of influence] For lists. It has also started online auctions of homes, which are exempt from lawsuits. ”
- “[Preparing] Used to train agents and loan originators. ”
- “I work for a construction company, so I’m trying to reduce the number of buyers using agents.”
- “Prepare agents to introduce the concept of flat fees.”
- “Thinking more about how lawyers and financiers are involved.”
- “[Will] Maybe you’ll avoid buyer’s agents altogether. ”
- “Sale, withdrawal, merger.”
Methodology notes: This month’s Inman Intel Index survey poll was conducted October 23-31, 2023, and the entire Inman reader community was invited to participate, with Intel receiving a total of 1,269 responses. Respondents to this study were directed to her SurveyMonkey platform, where they self-identified their profile in the residential real estate market. Respondents were limited to one response per device, but there was no restriction on IP address. Once a profile (Residential Realtor, Mortgage Broker/Banker, Business Executive/Investor/PropTech, etc.) was selected, respondents answered a unique set of questions regarding that specific profile. Because the survey did not request demographic information such as age, gender, or geography, data was not weighted. This survey is conducted monthly and includes both recurring and unique questions for each profile type.
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