Home Inspections - What's Changed in the Last 3 Decades?

In 2019, lawsuits were brought against real estate companies like Keller Williams, ReMax, Anywhere Real Estate (owner of Century 21, Coldwell Banker, and Sotheby’s), and the National Association of Realtors (NAR). These lawsuits were settled, and starting August 17, 2024, new contracts and disclosures will be required by real estate agents. Here’s how these changes might impact home purchases, especially in relation to home inspections.

How Will This Affect the Real Estate Industry?

The impact is still uncertain, but a CNN article offers some insights. You can read more about it here: NAR Settlement Set to Hit Real Estate Agents This Week: Here’s How They’re Preparing | CNN Business.

Shift in Payment Responsibility for Commissions

Traditionally, the seller’s agent’s commission has covered the buyer’s agent’s fee. The settlement may now require buyers to pay their agent directly, increasing their upfront costs.

• Impact on Buyers: Some buyers might choose to skip using a buyer’s agent or opt for limited-service agents. While this may work for some, most buyers will still want to work with an agent, which means they’ll need additional funds beyond the down payment. To help with these costs, Dunsing Inspections offers “Flex Fund,” which allows inspection fees to be paid at closing instead of upfront.

Other Considerations That May Affect Buyer Decisions:

• Increased Awareness of Commissions: Buyers may become more aware of how agent commissions work and who pays them.
• Reduction in Buyer Agent Services: As buyers take on more commission costs, some agents might reduce their services to attract cost-conscious clients.
• More Direct Negotiations: With fewer buyers using agents, direct negotiations between buyers and sellers could become more common.
• Demand for Alternative Real Estate Models: The settlement could increase interest in discount brokerages, flat-fee MLS services, or online platforms that reduce or eliminate traditional agent roles.

How Will This Affect Home Inspectors and Client Interactions?

• Greater Emphasis on DIY Home Buying: With changes in agent compensation, more buyers may handle aspects of the home buying process themselves, including property searches, negotiations, and inspections.
• Impact on Buyers: Buyers may increasingly turn to third-party services like home inspection companies for advice traditionally provided by buyer’s agents, such as understanding inspection results.

At Dunsing Inspections, we’ve built trusted relationships with our clients for over 40 years, and this will continue. As homebuyers may rely more on inspectors in the absence of a trusted real estate advisor, we expect our role to become even more important. While communication often ends at the driveway after an inspection, we’re prepared to support buyers throughout the entire process, acting as a trusted advisor.

“Dunsing is prepared to support buyers throughout the entire process, acting as a trusted advisor.”

These trends suggest buyers will need to be more informed and involved in the home buying process, potentially relying more on home inspection companies for guidance. Dunsing Inspections is ready to be your home buying consultant. Are you ready to purchase a home? Call us for your home inspection.