The ‘New Norm’ For Real Estate Professionals
For my first 30 years as a real estate educator, attorney, and author, I taught Real Estate Principles and Practices to students in a pre-license school in Hawaii. I was amazed that all that was required to obtain a state salesperson license was successful completion of a 40-hour course and passing the state license examination. Although it was often a struggle to make enough money to cover all the initial expenses, for many it was a quick way to generate their first of many sales by simply procuring a buyer for a MLS listed property. There was no requirement to negotiate a buyer representation agreement (BRA) with the buyer; heck, in the early days, all cooperating agents represented the seller/listing broker as subagents. There was no need to negotiate cooperative compensation, as the MLS set forth offers of compensation in an amount agreed to by the seller and listing agent.
Simply have the buyer make an offer to buy, the seller accepts, open escrow, and disburse funds to the listing broker and the buyer broker (often 50% of the listing broker commission). Thanks to what some called the “MLS Crutch”, it was so easy to compensate the buyer agent the same amount regardless of the level of service provided by a rookie graduate or a seasoned professional designated as an ABR.
The competition has always been fierce among seller agents to create listing presentations in order to secure the sacred listing. However, there was little competition among those wanting to represent buyers, other than the inevitable procuring cause disputes between brokers who provided specific services to the unrepresented buyer.
Turning the page
- Now, let’s turn the page to the new ballgame after August 17, 2024 when the MLS was forced to make certain “Practice Changes” – for a webinar covering the Practice Changes see a panel discussion by Saul Klein, Tristan Ahumada, and John Reilly
- 13 Practice Changes — https://www.youtube.com/watch?v=NcOB8S4_TlY&list=PLWscjoa0nkNsrCTfy1hV8bgCHxBynff8l&index=1
Among the critical steps in Practice Changes that require fundamental changes in traditional practice (“Paradigm Shifts”) are:
- No Offers of Compensation in the MLS (No MLS Crutch) (End of procuring cause cases)
- Required written agreement to tour a property (need not be a buyer agency agreement)
- Negotiation between seller and listing broker; between buyer and buyer agent; between seller and buyer at purchase offer stage
- Required Written Buyer Representation Agreement that negotiates method of compensation (flat fee, hourly, traditional, performance-based) See https://parisparadigm.com/
- Buyer brokers compete fiercely to secure the buyer listing, to the same degree as seller brokers compete to secure the property listing.
Buyer brokers will have to develop new skill sets to demonstrate their value to buyers that highlight their experiences
Here are some suggestions on value propositions from several industry thought leaders as published on The Data Advocate:
- From Tristan Ahumada – “As 2024 rolls on, the real estate world is seeing some big changes, especially in how we handle transactions and compensation. To help you stay ahead and provide even better service to your clients, we’ve put together a simple graphic that you can use and adjust to fit your needs.” See graphic at https://thedataadvocate.com/wp-content/uploads/2024/08/New-White-Background.pdf and article on The New Landscape at https://thedataadvocate.com/the-new-landscape-of-real-estate/
- According to noted visionary Saul Klein, “today’s consumers are increasingly informed, demanding, and time-constrained. They seek speed, convenience, choice, value-added services, quality, exceptional service, discounts, and access to information. Real estate professionals who can effectively address these “driving forces” are well-positioned to succeed.” See https://thedataadvocate.com/a-menu-driven-approach-to-real-estate-a-blueprint-for-success/
- According to recognized marketing genius Brian Boero, “in the past, we’ve missed the opportunity to ‘tell our value to the transaction story.’ Although it is imperative that we communicate our activities around the services of buying and marketing properties, but what the customer really doesn’t have is a clear sense of what the agent really did, let alone how they were paid.” See https://thedataadvocate.com/the-wake-up-call-with-brian-boero/
- From Joe Schneider EVP of Consulting at Modern.tech, “Without having to subject everyone to a mind-numbing recap of the result of the industry lawsuits (you should know this by now), I’ll sum it up: buyers will now be choosing agents based on two factors – what they can afford, and how much value a buyer’s agent can add relative to their competitors. This tip-of-the-spear for real estate transactions has been redefined, and as a result, the relationship dynamics in any real estate transaction have also shifted. The bottom line: buyer’s agents need to demonstrate value to consumers. This presents an opportunity for PropTech companies uniquely positioned to enhance, display, augment, or otherwise increase the value that the buyer’s agent offers to the consumer. See https://www.modern.tech/insights/proptech-in-the-post-settlement-world
- And for those concerned about the threat of AI driving them out of the business, here’s a positive message from Tristan Ahumada: “In a world where technology handles the routine, the agents who focus on relationships will become even more indispensable, offering the emotional intelligence and trust that technology cannot replicate.” See https://thedataadvocate.com/the-future-of-real-estate-agents-by-tristan-ahumada/
We welcome your thoughts on sharpening your Value Proposition and highlighting your Experience– add to the Reply section below.
6 Responses
In light of these transformative industry shifts, it’s invigorating to see the real estate world aligning with the principles I’ve championed in my own business. By implementing blockchain technology and advanced PropTech solutions, my approach has preempted many of these new MLS-driven changes, particularly in terms of transparency, accountability, and value demonstration.
Blockchain offers an unprecedented level of transparency, securing every transaction detail and enabling real-time, accessible data across the buyer-agent relationship. This is especially critical in a world where clients demand transparency and speed in real estate transactions. Our clients can view offer statuses and transaction progress in real time, removing the traditional opacity around “behind-the-scenes” agent activities. This technology is a paradigm shift that not only meets modern consumer expectations but also enhances the security of financial transfers and personal data—two critical areas in an era of rising consumer awareness and data protection standards.
Moreover, the requirement for written buyer representation agreements directly aligns with our client-centric, value-first approach. Blockchain-powered systems allow us to establish clear, performance-based compensation structures with clients. We don’t rely on the outdated MLS commission system; instead, we offer clients a menu of options—whether flat fees, performance-based compensation, or hourly rates—enabling them to choose the structure that best meets their needs and budget. This reinforces the concept of “value-added service” by making our compensation a reflection of the tangible, technology-driven advantages we bring to the table.
Our emphasis on PropTech doesn’t just elevate our clients’ experience; it redefines what it means to be a real estate agent in 2024. While AI enhances efficiency, blockchain and data transparency distinguish our service by providing clients with unparalleled control and trust in the process. This fusion of relationship-focused service with cutting-edge technology positions us at the forefront of the industry, proving that real estate can be both high-touch and high-tech.
For agents navigating this new landscape, the path forward is clear: embrace technology not as a crutch, but as a tool to elevate our value propositions and enhance client trust. With transparency, security, and client empowerment at the heart of our operations, we’re redefining what clients expect from their agents—and it’s this approach that will guide the future of real estate.
Thanks Vanessa. My hope in writing the article was to stimulate meaningful discussion of the client-centric, value-first approach to navigating the new landscape. Your post far exceeded my expectation.
Great insight Vanessa! I teach a post licensure 6 CE Masterclass in the entire process and continually update this to suit current trends. I spend considerable time on the Value Proposition and what that means. Many agents believe this is about them. I believe it is about your value to the client and how you focus on them and their needs, i.e. being client centric. It is surprising how many agents who are in the business many years find this to be an eye opener. Unfortunately the industry and coaching often focuses on the agent and their needs.
I have experienced some headwind on my views but believe going forward that client focus and negotiating skills will be paramount to one’s role as a real estate agent. Along with that is the public persona of the entire industry which needs an image consultant and a total makeover. To sum up, that shift is my goal in helping those in this industry be better.
Great to see that you are right in sync with Vanessa’s views, as usual. Best wishes in reaching your goal to better those in the industry.
Great article! The real estate industry is evolving, and adapting to the ‘new norm’ is crucial for success. I liked the point about leveraging technology to stay competitive. Do you have any tips on how professionals can balance traditional methods with new digital tools? Thanks for the insights!
Flashing News today! Updated April 8, 2025
Roger P.Alford now working for the DOJ! — Certainly no fan of NAR and its policies.
https://www.justice.gov/atr/staff-profile/roger-alford-principal-deputy-assistant-attorney-general
Roger Alford will serve as Principal Deputy Assistant Attorney General. Mr. Alford previously served in the first Trump Administration as Deputy Assistant Attorney General in the Antitrust Division. Prior to returning to the division, he was a tenured Professor of Law at the University of Notre Dame Law School for nearly thirteen years. During that time, he also consulted on antitrust matters, including as an expert witness in the landmark 2023 real estate $1.8 billion litigation against the National Association of Realtors, and since 2019 consulting for Texas Attorney General Ken Paxton in Texas v. Google. He served as a law clerk to Judge James Buckley of the United States Court of Appeals for the D.C. Circuit, and Judge Richard Allison of the Iran- United States Claims Tribunal in The Hague, Netherlands. He also practiced law with Hogan Lovells in Washington, D.C. and was a Senior Legal Advisor to the Claims Resolution Tribunal for Dormant Activities in Zurich, Switzerland.
He earned his B.A. with Honors from Baylor University in 1985, his M.Div. from Southern Baptist Theological Seminary, his J.D. with Honors from New York University, and his LL.M., first in class, from Edinburgh University.