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Navigating Washington’s Agency Agreements Changes
You may have heard real estate laws are changing in Washington State. While navigating Washington’s agency agreement changes it’s important to note that it’s not uncommon for laws to change as industries evolve. In 2019 the rules requiring that buyer broker compensation be offered to list a property was eliminated. For transparency purposes, in 2019 another law made the buyer broker compensation offered in the listing viewable to the public. In 2022 laws were implemented that made the offer of buyer broker compensation separate and distinct from the offer to the seller’s broker. That same year, our Northwest Multiple Listing Service started including the amount of buyer broker compensation in the purchase and sale agreement so there is complete transparency within the transaction.
Other great changes that help the buyers and sellers is a revision of the agency law pamphlet. It is now more easily read and understood (taking it from 8 complicated pages to 4) and there is a requirement to sign a contract with buyers. Now buyers truly chose who is representing them and it doesn’t just happen randomly. Our brokers have been studying extensively not only the new laws but how to best implement them and prepare their clients to understand how the changes in the laws will affect them. Follow along as we walk you through navigating Washington’s agency agreement changes with an overview of the changes, how it impacts buyers and sellers, and offer you further resources for more information.
Overview of the New Laws:
Prior to January 1, 2024 Washington State law only required brokers representing sellers to enter into a brokerage agreement. Starting January 1, 2024 Chapter 18.86 RCW mandates brokers representing buyers in a residential transaction enter into a written brokerage service agreement as soon as reasonably possible. Washington is the first state to implement this type of legislation. This contractual arrangement encompasses key provisions such as the duration of the partnership, exclusivity terms, and the agreed-upon compensation rate. The purpose of the change is to ensure that buyers understand the scope of the representation, how much it will cost, and how the costs are paid prior to agents providing any real estate services.
Impact on Buyers:
There are a couple of changes that buyers should expect to see. The first is that they will be asked to commit to a Buyers broker early on. It’s going to behoove buyers to take their selection of the broker they work with much more seriously. Buyers will now be presented with an agency agreement prior to their agents providing any services. This might feel a bit off-putting to commit so soon, but Windermere brokers have never forced clients to work with them and are using an agreement that gives buyers control to end the agency relationship at any time. Be sure to read the agreement carefully and identify what the procedures are for canceling the buyer-broker agreement. Great Agents often provide you with a cancelation document or instructions upfront so that you can rest assured that you will not be stuck if their services don’t meet your expectations.
Impact on Sellers:
For the most part, sellers are not significantly impacted by the new changes. The only significant change that sellers can expect to see is that agents may offer a Seller Brokerage Service Agreement earlier than in the past. The new listing agreement allows for signing up to 90 days in advance of going on the market.
Overall, the changes are positive. They are put in place to protect consumers, which we are all about! By law, every client is to receive the Agency Law Pamphlet. The buyer or seller should take time to read it and understand it prior to signing any agreement. If you find yourself with more questions than answers, don’t hesitate to ask questions or seek guidance. If an agent does not currently represent you and you are seeking quality representation, connect with us. We can give you a few names of excellent brokers to interview. It is important to stay informed about these changes to ensure a smooth real estate transaction.
If you would like to discuss this in greater detail, please do not hesitate to connect with us.
You’ll Lose Money When You Overprice Your Home
You are probably asking yourself, “did I read that right?”
Yes, yes you did.
It is normal for sellers to want to get the most money out of the sale of their homes. It feels safe to list your home at the price you are desiring to get, but the reality is listing high might actually do your pocketbook more harm than good in the long run. Follow along as we explain why.
RISKS OF OVERPRICING YOUR HOME
You are drawing the attention of the wrong buyers.
Most people begin their home purchasing journey by searching which homes are available in their desired location online. Consider this. Your home is worth $500,000, but you list it for $575,000. When buyers are looking online, they filter to find homes within their price range and typically by $25,000 increments. The person looking for a $500,000 home will never see yours and if they do they will believe it is out of their reach, and when the buyers looking in the $575,000 range see your home and compare it to others in that range, they will get the impression it is not worth it, and there are better options.
Fewer people will see your home.
When your home is overpriced, the issue can be detected by buyers just by looking at your online listing and will pass on viewing it in person. The more showings you have, the more legitimate interest there is, and the more likely your home is to sell. Showings give potential buyers an opportunity to see the home first-hand giving them the opportunity to imagine themselves living there.
On the other hand, if you get lots of showings because your photos look better than reality but no offers you’ve wasted your best shot at getting the right buyer through your home and you there are no redo’s for first impressions. This leads us to our next point…
You are sending the “I’m an undesirable home” message to the public.
As people continue to look for a home and new buyers enter the market, they might see your home online, but by that time they will also see the “time on market”. The longer your home sits on the market, the less attractive it becomes psychologically to everyone. Nobody wants the home that nobody else wants. Once it has lost its appeal the damage is done. You’ll find yourself beginning to reduce your price and often end up at a price less than what the home could have sold for if it was priced right the first time.
In conjunction with price reductions, the longer your home sits on the market, the more expenses you incur. Consider mortgage payments, utility costs, lawn care maintenance, seller’s fees, and more while you are trying to move out.
Your buyers won’t be able to finance if it doesn’t appraise.
Perhaps you drop the price just enough to intrigue a buyer but still above market level. Maybe you’re lucky enough to hook a buyer. Then the appraisal comes back low. Now you either have to come down in price or lose the buyer and start over again, with 20-30 days more on market…
If you are considering selling your home and would like a complimentary analysis to determine the correct value of your home in this market connect with us to be paired with an experienced Windermere agent that can help you with your unique situation and avoid all the overpricing pitfalls.
Back to School: Realtors Edition
If you aren’t a real estate broker you probably don’t know that September doesn’t just initiate back to school for our kids but as an industry, this is the beginning of conference season! This just means that Fall and Winter tend to be slower seasons and provide the best time for busy brokers to grab a block of hours or even a block of days to spend sharpening their skills. Great brokers are committed to being lifelong learners. They keep up with the ever-changing market, lending options, negotiating tactics, marketing techniques for properties, and the list goes on.
If you are a broker…
You may be looking for some great opportunities that are coming up in the next few months. We have collected a few that we think will be really worth your time. Take a peek and please let us know if we missed one of your favorites because we would love to add it to our list.
New Forms are coming SOON! Please take advantage of educational opportunities to study and familiarize yourself with the changes.
You can take one of the many virtual classes the NWMLS is offering here
Oct. 14, 9-3pm in Oak Harbor! Fair Housing Class, 6 clock hours
Ninja Installation Tacoma Dec 5-8 (Brokerage pays for 1st timers)! $1,100 Thinking about joining our team? Connect with us.
Conference Opportunities:
Windermere Homecoming! $350 (plus accommodation and travel) Sept. 29-30
Inman Connect NYC Jan 24-26 $900
Denise Lones Prosperity Strategy California Nov 9-11, only 50 people! $3,500 w/ accommodation
NAR Conference Orlando Nov 11-13 $450
In addition to these great learning opportunities our brokerage brings in an expert speaker 2-3 times on topics from septic systems to negotiation tactics, from topics as unique as forestry management to ones that are pretty applicable on an island like shoreline processes and bluff stabilization. If you’d like to attend one of these trainings let us know! We’d love for you to be our guest in learning because the better we can serve our clients in this industry the better!
Collaboration, Competition, & Putting the Client First
-Why we are better together at Windermere
Many people think of real estate as a cutthroat competitive sales business akin to the dynamics that are portrayed on a TV show like Million Dollar Listing. The world is always pitting competition vs. collaboration against each other as if these two things are completely exclusive from one another.
This is why it is so darn refreshing when you see collaboration amongst “competitors,” and it’s something we see at Windermere all the time.
One of Windermere’s core values is that we are all better together, and we are huge believers in the very different way Windermere real estate agents operate. But what does “better together” really mean? How does this play out in the day-to-day?
Of course, “better together” in part refers to the collaboration aspect in real estate. No one doubts two heads are better than one when it comes to problem-solving, and how about ten heads or a whole brokerage full of knowledgeable professionals to draw from? In our brokerage, a seasoned agent or a total newbie who comes up against something unusual (which happens more often than you would think) can easily pick the brains of agents representing 100’s of years of experience. From in-person conversations to our Facebook group page; we encourage ideas, questions, new information, resources, and sometimes just funny memes. Real estate is about being creative, not taking no for an answer and problem solving like a maniac. Having a support group you can rely on results in miracles for your clients other agents can’t produce.
“Better together” also means we have a lot of pride in the standard Windermere sets in the real estate industry. This translates to holding each other accountable when a colleague is delivering less than their best. For those of us who thoroughly understand the benefits of holding the real estate industry to a high standard, it literally hurts our hearts when we see agents acting in ways that are embarrassing for our profession and even worse, harmful to the client. This is why we believe in continually raising the bar on this industry so others have to stretch themselves just to keep up.
We take the idea of “better together” seriously but that doesn’t mean we don’t like to have fun doing it!
The video below was envisioned, orchestrated, and paid for by the agents. It is a pure collaboration amongst some of the most successful agents at Windermere in Oak Harbor who have intense respect for one another and understand that being better together helps everyone.
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