What Homebuyers MUST Know About the NAR Settlement (with @LaterWendy) | Ep. 7
Introduction
Nick: Hey everybody and welcome back to the DIY Home Buyer Podcast. This is a show that's all about empowering home buyers to purchase a home without needing to hire a costly buyer's agent. We believe that taking control of big decisions in life is a really good thing, and that an educated consumer is the best kind of consumer.
Today, I'm thrilled to have our guest, Wendy, who has been advocating for consumers far longer than I have. Wendy has an amazing story that began when she was looking for a non-traditional way to sell her home several years ago. This led her to start a platform called Selling Later, and as she built that out, she got to take a look behind the curtain of the real estate industry.
Wendy's Journey into Consumer Advocacy
Wendy: Originally, we were building a home and had a townhouse to sell. We knew seven months ahead when we were going to sell, but there wasn't anywhere to tell people, "Hey, I'm going to sell in March of next year. Let me know if you're interested." It just didn't exist.
I ended up launching Selling Later and got invited to Inman [a real estate conference]. I stood on stage and told the whole crowd how everyone should know what homes are selling for and that information shouldn't be hidden. Of course, it was like crickets, because this industry doesn't really want that available to consumers.
People started coming up to me talking about referral fees and making money. The head of Boomtown, a major lead generation company, approached me about referral fees—I had no idea what those even were at the time.
Industry Insights and Issues
Wendy: As I networked with big companies and VC-funded organizations, I kept getting this gut feeling that I didn't belong. None of them were really talking about the consumer; they were just talking about money.
Every year I networked more and learned more, eventually connecting with consumer advocacy groups. I now work with influential people like Steven Brobeck and Doug Miller, who have been involved in the NAR settlement and lawsuit.
The Evolution of Buyer Agency
Nick: The whole idea of buyer agency is kind of weird when you think about it. In the UK, 99% of all transactions, the buyer is unrepresented. Even in America, pretty much every other purchase we make, there's no such thing as a buyer's agent.
Wendy: Originally, it was more like the European model where the buyer's agent wasn't actually representing the buyer. NAR will say that home buyers really wanted this fiduciary buyer agency, but if you read Rob Hahn's articles, it was just as much about brokerages being sued because buyers felt misled.
The industry pushed buyer agency to consumers as a "free service," never really explaining the fiduciary relationship. If buyer agency was rolled out as something similar to hiring a lawyer, with massive skill sets required, it would be a different story.
The NAR Settlement and Its Impact
Wendy: The Department of Justice has been after NAR for years regarding steering—avoiding certain homes based on commission. This private settlement was brought up by Doug Miller and originally Cohen Milstein.
Key points about the settlement:
Buyers now need to have upfront agreements with agents
Agents must disclose their fees
Buyers are encouraged to negotiate fees ahead of time
Agents can't make more than what's written in the agreement
Future of Real Estate: Wendy's Vision
When asked about her ideal vision for the industry, Wendy outlined several key reforms:
MLS System Reform
Consolidate from 500+ systems to one per state
Separate MLSs from realtor associations
Give consumers better access to data
Diverse Value Structures
Enable different pricing models (hourly, flat fee, etc.)
Stop stigmatizing lower-cost options
Embrace variety in service levels
Independent Oversight
Create regulatory systems outside state commissions
Reduce NAR's influence on oversight bodies
Establish more consumer representation
Standardized Forms
Make contracts publicly available
Create consumer-friendly forms
Ensure transparency in agreements
Referral Fee Transparency
Require disclosure of data selling
Make clear how referral fees affect negotiating power
Protect consumer information
Advice for DIY Homebuyers
Wendy: If you need help, great, hire help. If you can handle it on your own, go on your own. Just make sure you at least have an attorney or know what you're doing. Don't let someone pressure you into doing it one way or another, because it's not a one-size-fits-all industry—they used to tell you it was, but it's not.
Resources and Contact Information
For more information:
Visit Selling Later website
Follow Wendy (@laterwendy on social media)
Check out Rob Hahn's articles on industry history
Read Tanya Monestier’s work on contracts
