It may be a little cheaper to buy a home — not because of prices

It’s not exactly a price break, but home buyers may be paying a little less to purchase a home.

It’s been a few months since changes took effect on how real estate agents are paid commissions. So far, there’s evidence of a slow decline in buyer agent rates over the past year, said Steve Brobeck, senior fellow with the Consumer Federation of America.

He examined three different surveys of real estate agents nationwide. They found that the percent of a home’s sale price paid to the agent working with the buyer has fallen by up to four-tenths of a percent.

“There's been a sharper decline for inexperienced agents and for part time agents than for successful full time agents,” he said.

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Different studies since August find commissions paid to agents representing home buyers are flat to down by about a third of one percent. That represents a drop of about $2,000 for the work to buy a home that sells for around $500,000.

It’s not a dramatic drop in real estate agent commissions but no state has more people impacted by the changes than Florida and no place in Florida has more real estate agents than the Miami area. Vincent Imburgia.

Vincent Imburgia began in real estate like a lot of agents — part-time. After working in the construction industry, he made the jump to full-time real estate agent in 2017.

“You're not chained to a desk. You're out in the field,” he said. “You're changing lives.”

The way agents working with home buyers changed in October. The decades-old way agent commissions were paid was upset thanks to a class-action lawsuit settlement with the National Association of Realtors. Agent commissions can no longer appear on the Multiple Listing Service, the database that includes most homes for sale. It used to be that those commissions came out of the selling price of a home. Now, agents working with buyers have to have a contract spelling out how much their agent will be paid and how.

Agents and the real estate industry point out agent commissions have always been negotiable. They were usually around 2.5% to 3% each for the agents representing the sellers and the buyers. That money came out of the purchase price of the home.

The small drop in commissions paid by buyers since the new rules indicated by the studies come as data show commissions had already been dropping. A study by Redfin found buyer agents were paid 2.5% in early 2023. But that had fallen to 2.3% after the settlement. That’s $1,000 less when buying a home for half a million dollars.

That savings for buyers can add up for their agents and the industry. There are more than 200,000 realtors in Florida.

"We think that in several years, the buyer agent rates will come down to an average of about a 2%," said Brobeck. "The experienced agents will be able to charge higher rates than those who've just earned their license."

“In my career, I have never been compensated by a buyer. I've always been compensated by the seller,” Imburgia said. “I think that that will continue because at the end of the day, it's a business decision for the seller.”

Brobeck, of the Consumer Federation of America, said the first few months of the new rules haven't been easy for buyers to navigate. “The  most important impact initially has been confusion on the part of not only consumers, but also buyers,” he said.

Buyers have to have a written agreement if they’re working with an agent with some agents requiring a deal before touring any homes with a potential buyer.

“If a consumer wishes to hire a real estate professional in the capacity of a buyer's agent, ultimately their fee will be the consumer's responsibility,” Imburgia said, noting he continues seeing home sellers still offering to pay the buyer’s agent commission, similar to the traditional structure prior to the class action settlement.

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Agents and buyers still are getting used to the new rules. Brobeck thinks the total commissions on buying and selling a home will “come down to maybe 4-4.5%” within a couple of years.

Imburgia noted that even though his commission has fallen about half a percent, he welcomed the changes.

" I think (the market) needed needed this shift. There needs to be an enhanced professional and transparency," he said. "I think for the polished agent, it's an opportunity to showcase their value."

He said he did less than 10 deals in 2024. He concentrates in northeast Miami-Dade County like Miami Shores, El Portal and North Bay Village, where home prices often are over $1 million. He calls 2024 a very good year even if his commission has fallen a little.
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