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#35 The NAR Lawsuit (7 Months Later). What Really Changed? · Own More Doors

• 0:00
  SPEAKER_00: What's up, everyone?
• 0:01
  SPEAKER_00: Juan Weezar here with the Own More Doors podcast.
• 0:04
  SPEAKER_00: This specific episode was first shared on our YouTube channel, Sage Real Estate.
• 0:08
  SPEAKER_00: Check it out.
• 0:09
  SPEAKER_00: And we're excited to bring it to you here.
• 0:11
  SPEAKER_00: Hey everyone, it's been seven months since since the National Association of Realtors came out and completely changed the way that we had done business.
• 0:18
  SPEAKER_00: And so I wanted to give you guys an update on what has happened in the last seven months since this new law.
• 0:24
  SPEAKER_00: So let's dive right into it.
• 0:26
  SPEAKER_00: Hi, I'm Juan Weezar, president of Sage Real Estate, and our channel is dedicated to teaching people how to build wealth through apartment ownership.
• 0:32
  SPEAKER_00: Thank you guys so much for tuning in.
• 0:35
  SPEAKER_00: Make sure to like, comment, subscribe, hit that subscribe button.
• 0:38
  SPEAKER_00: Now let's dive into it.
• 0:40
  SPEAKER_00: So, okay, so there's a couple things.
• 0:42
  SPEAKER_00: In the past, when I would be hired by a seller, I would sit down with the seller, I would negotiate the commission.
• 0:49
  SPEAKER_00: In some cases, I would say, hey, it's going to be 6%.
• 0:52
  SPEAKER_00: That'll be 3% for me on the listing side, 3% for the buyer's agent.
• 0:57
  SPEAKER_00: So I would be negotiating the commission for the buyer's agent.
• 1:00
  SPEAKER_00: And that fee fluctuated, you know, it could be 5% where you're taking 2.5%, then you're paying out 2.5%, adds up to 5%.
• 1:09
  SPEAKER_00: Sometimes in the world of real estate, the larger the listing, so once you get to a multi-million dollar listing, that could even go down to 4%, where the listing agent, me, would do 2% and I'm negotiating the other two.
• 1:23
  SPEAKER_00: Well, they took out the negotiation for the buyer's agent.
• 1:27
  SPEAKER_00: Meaning, when I sit down with a seller, I now could only negotiate the listing side.
• 1:35
  SPEAKER_00: Okay.
• 1:35
  SPEAKER_00: So that part's still the same.
• 1:39
  SPEAKER_00: And this was supposed to completely disrupt our industry.
• 1:43
  SPEAKER_00: This was supposed to make it where the buyer pays the the buyer's agent commission.
• 1:52
  SPEAKER_00: That is what was supposed to happen.
• 1:54
  SPEAKER_00: I'm going to tell you what really happened.
• 1:57
  SPEAKER_00: And the concept was good, but like typical things that our politicians pass, they fall flat on their face.
• 2:07
  SPEAKER_00: Okay?
• 2:07
  SPEAKER_00: That's just a fact.
• 2:10
  SPEAKER_00: The reality is, seven months later, absolutely nothing has changed.
• 2:16
  SPEAKER_00: What I did is I um I went and we interviewed multiple escrow companies.
• 2:23
  SPEAKER_00: And an escrow company sees the transaction coming in, an escrow company sees the listing agent getting paid and who pays the buyer's agent.
• 2:33
  SPEAKER_00: And in every single case, every single interview across the board, a hundred percent of the time the seller was still paying the buyer's commission.
• 2:44
  SPEAKER_00: Let me repeat that.
• 2:50
  SPEAKER_00: So, folks, what does that mean?
• 2:53
  SPEAKER_00: Absolutely nothing has changed.
• 2:55
  SPEAKER_00: You might wonder, okay, well, why does this even matter?
• 2:59
  SPEAKER_00: A couple things.
• 3:00
  SPEAKER_00: I still get calls from sellers who say, hey, I heard about this lawsuit.
• 3:06
  SPEAKER_00: I'm glad that I only have to pay you.
• 3:09
  SPEAKER_00: True.
• 3:10
  SPEAKER_00: That first contract is only a contract with me.
• 3:13
  SPEAKER_00: But what ends up happening is we market the property, we're going to get offers, and every single buyer's agent is saying, I want my compensation.
• 3:22
  SPEAKER_00: So now they're negotiating with the seller.
• 3:26
  SPEAKER_00: Now I guess someone could say, okay, did the seller, is the seller paying less commission?
• 3:33
  SPEAKER_00: Now that I don't have all that data, and I would probably say the seller is probably paying a slightly less commission in some cases.
• 3:40
  SPEAKER_00: Slightly.
• 3:41
  SPEAKER_00: But in most cases, um, the seller is still paying the buyer's commission.
• 3:47
  SPEAKER_00: Um, another thing that I try to do to give us more data, more intel for the specific video, is when I list a property on the multiple listing service, that's the website where we pay to be associate members of this website.
• 4:04
  SPEAKER_00: This is where we we input the property that we're gonna sell.
• 4:07
  SPEAKER_00: That's where I market the property, okay?
• 4:11
  SPEAKER_00: When I'm done selling that property, and in my in my case, it's mostly apartment buildings.
• 4:18
  SPEAKER_00: I'm supposed to change it from when it's active to when it's an escrow to when I close it.
• 4:25
  SPEAKER_00: Now, when I go to close, it says, Did you?
• 4:28
  SPEAKER_00: Who paid the buyer's agent commission?
• 4:30
  SPEAKER_00: You're supposed to put it on there.
• 4:32
  SPEAKER_00: Now, we look there because we were hoping to see that in most cases the seller continued to pay the buyer's commission.
• 4:40
  SPEAKER_00: And what we ended up finding was that the data was inconclusive.
• 4:44
  SPEAKER_00: Why?
• 4:45
  SPEAKER_00: A couple things.
• 4:46
  SPEAKER_00: Either agents are lazy and they're not being complete and filling this in.
• 4:50
  SPEAKER_00: Um, the agents' assistants rush it and aren't very detailed.
• 4:55
  SPEAKER_00: But several things that you're supposed to include when you close a property is were there any concessions paid for repairs?
• 5:04
  SPEAKER_00: Was there any concessions paid to for the buyer's um lending fees?
• 5:12
  SPEAKER_00: And it says who it was there a commission paid to the buyer?
• 5:16
  SPEAKER_00: Now, the reason why I'm telling you it's inconclusive is that now we're trying to trust the agents, the listing agents.
• 5:24
  SPEAKER_00: Now, it's easy to close out the transaction, leave that blank, and now we we look at it and say, aha, in this situation, in this situation, the buyer's agent or uh the buyer's agent was compensated by the buyer.
• 5:38
  SPEAKER_00: But that that data is inconclusive because I don't think that people are are being detailed or being thorough.
• 5:44
  SPEAKER_00: So that's a problem.
• 5:45
  SPEAKER_00: But where it's not a problem is escrow.
• 5:48
  SPEAKER_00: Because escrow knows.
• 5:50
  SPEAKER_00: Escrow definitely knows.
• 5:51
  SPEAKER_00: And so what I wanted you to know is if you are a seller, don't go into this thinking that you're not going to be paying the buyer's agent commission.
• 6:02
  SPEAKER_00: You are.
• 6:03
  SPEAKER_00: You have the chance to say no.
• 6:05
  SPEAKER_00: I want you to know that.
• 6:06
  SPEAKER_00: You do have the chance to say no.
• 6:08
  SPEAKER_00: But who's gonna compensate them?
• 6:10
  SPEAKER_00: The buyer?
• 6:11
  SPEAKER_00: The buyers are not really compensating them.
• 6:15
  SPEAKER_00: I know that that that the headlines tell us that, but I'm telling you, based on thousands and thousands of escrow transactions since the last seven months, close to 100%, the seller's still paying that fee.
• 6:30
  SPEAKER_00: Um, most times, if you're a seller, you should want to pay that fee.
• 6:36
  SPEAKER_00: That's how you're incentivizing the agent to help push that transaction along.
• 6:41
  SPEAKER_00: Um, there are 30 negotiations that take place.
• 6:44
  SPEAKER_00: This is a very um time is of the essence um transaction.
• 6:49
  SPEAKER_00: Every transaction is.
• 6:50
  SPEAKER_00: There are calls, literally, I'm gonna say 24-7 because you're on the phone nonstop.
• 6:56
  SPEAKER_00: And so now for buyers, I still get I'm fortunate enough that there's a lot of investors that want to work with us.
• 7:05
  SPEAKER_00: They want us to represent them and they say, What is your fee?
• 7:08
  SPEAKER_00: I heard, I saw the headlines, what is your fee?
• 7:11
  SPEAKER_00: What do I have to pay you?
• 7:13
  SPEAKER_00: And I tell them this we're gonna have an agreement because we're required to have an agreement with you that's gonna say that if the seller doesn't pay us, you're gonna agree to this amount.
• 7:25
  SPEAKER_00: And I tell them, no buyer has had to pay me a commission.
• 7:31
  SPEAKER_00: Why?
• 7:32
  SPEAKER_00: Because in every situation personally, we've been compensated by the seller.
• 7:38
  SPEAKER_00: And so has anything changed?
• 7:41
  SPEAKER_00: Not at all.
• 7:42
  SPEAKER_00: Um buyers, it there would have to be like a 1% chance that you'd be paying for it.
• 7:49
  SPEAKER_00: And in some cases you might want to, but what I'm telling you is that in most cases you don't.
• 7:54
  SPEAKER_00: So there you have it.
• 7:55
  SPEAKER_00: Um, I'm gonna continue following this.
• 7:58
  SPEAKER_00: I I this matters to me.
• 7:59
  SPEAKER_00: You know, this law got passed to change or disrupt our business, and I'm telling you that nothing resulted from it because it's still business as usual.
• 8:09
  SPEAKER_00: Are there additional forms we have to sign?
• 8:12
  SPEAKER_00: Yep, there's additional forms we have to sign.
• 8:14
  SPEAKER_00: But has any major change shifted?
• 8:17
  SPEAKER_00: Not at all.
• 8:18
  SPEAKER_00: So I hope you guys enjoyed this.
• 8:20
  SPEAKER_00: Make sure to like, comment, and subscribe.
• 8:22
  SPEAKER_00: Now, if you enjoy my channel, I'm gonna ask a couple things.
• 8:26
  SPEAKER_00: February 27th, I'm putting on a live event, multifamily investor summit here in Long Beach, beautiful city of Long Beach.
• 8:33
  SPEAKER_00: Come network, learn, meet and greet, not just me, but a lot of people that that are part of our community and be surrounded, be inspired, come learn.
• 8:44
  SPEAKER_00: See you there.