This week brings the third BAM–1000Watt Agent Sentiment Report, based on survey responses from agents of all kinds from across the U.S. 

This time, we’re taking a closer look at— 

  • How agents feel about commission lawsuits
  • What they’re doing now to adapt to the most likely changes, and 
  • What they need from their leaders to thrive in a decoupled commissions environment

The full, downloadable report is available on BAMx. Read on for some of the highlights. 

Where are today’s agents coming from?

When it comes to buyer agent compensation, many agents are already beginning to shift away from buyer representation agreements, while others have yet to see any change in the decades-old practice of cooperative compensation. 

After all, as many respondents pointed out, decoupled commissions will likely hurt the buyer most—and particularly those who forego representation due to the cost. 

Take the UK, for example, where buyer’s agents don’t exist. If you haven’t yet watched our BAM interview with top UK agent Matt Nicol, it’s jam-packed with eye-opening differences between the UK real estate industry and our own. 

Back to the survey responses— 

  • 45.79% of respondents practice in a state that currently requires buyer representation agreements; 54.21% do not. 
  • For those working in states where a buyer representation agreement is not required, only 20.45% have a broker who mandates the use of buyer representation agreements. 
  • 44.26% are using an MLS that has made changes in response to commission lawsuits, while 55.74% report no changes within their MLS. 
  • The vast majority of respondents (91.12%) report few if any consumers they’ve encountered have mentioned/asked about the commission lawsuits, which suggests limited consumer awareness of (or interest in) these issues. 
  • Of those who are hearing about the commission issue from consumers, 60.48% say it comes up in conversation most often with home sellers, while 39.52% say they hear about it more often from home buyers. 

Agent sentiment and reactions

Now that we have some context, let’s dive into agent sentiment and reactions to the ongoing changes in the industry with respect to buyer agent commissions. 

First of all, judging by their responses to the question, “How worried are you about your business in light of commission lawsuits?” agents aren’t really losing sleep over the possibility of their business flatlining as a result of Sitzer/Burnett and related lawsuits. 

Asked to rate their concern on a scale of one to ten, with ten being “very worried” and one being “not worried at all,” the average response was less than five (4.17). 

Agent-Sentiment-Report-chart_How-worried

Source: BAMx

Here’s how agents responded to a few other sentiment-related questions:

#1—How would you describe your broker’s or company’s response to the commission lawsuits and the potential changes they present?

Across all agent categories, the majority of respondents (55.49%) expressed confidence in their company’s proactive approach. 

But a significant percentage of them reported feeling underserved or unsupported in navigating the challenges posed by commission lawsuits and potential changes in the commission structure. 

#2—What do you feel is your biggest need in responding to the commission issue?

The majority of agents across all categories (68.15%) expressed a need for support with marketing and messaging to help them effectively explain the commission/lawsuit issue and  communicate their value to consumers. 

#3—If you were looking to move to a new brokerage, how important would that company’s legal, marketing and training approach to the commission be in your decision-making?

Overall, the majority of respondents (57.12%) weigh a brokerage’s legal, marketing, and training approach to commissions to be of “primary importance” or “important, but not the most important consideration” when contemplating a move to a new brokerage. 

Changes agents are making (or have made) to adapt

Now, we come to the questions related to what agents are doing right now—or have already done—to adapt to changes already underway as well as those expected by a growing number of real estate professionals. 

#1—Have you changed your buyer consult due to potential commission changes for the industry?

More than half the respondents (53.45%) indicated adjustments to their buyer consultation process because of the commission lawsuits and to prepare for potential commission changes. But 46.55%, across all categories, have made no changes to their buyer consult. 

#2—If yes, are you finding that your changes have been effective with clients/prospects?

Among the 53.45% of respondents who have changed their buyer consult, most of them (83.66%) said their changes have been “definitely” or at least “somewhat” effective. 

#3—Have you altered your listing presentation due to potential commission changes for the industry?

Just over half the respondents (50.08%) said they’ve made changes to their listing presentation in response to poten

#4—Have you communicated anything about the commission lawsuits in your marketing (posting to social, emails, etc.)?

The majority of respondents (85.45%) have not communicated anything about the commission lawsuits in their marketing (social media, email, etc.), with just 14.55% saying they have. 

Of those 14.55%, the majority (67.37%) say they haven’t received much of a response from consumers, while 30.53% said consumers appreciated the information. Only 1.05% of these respondents saw negative reactions from consumers.  

What do agents think about proposed commission changes?

Agent responses to this final question generally boiled down to two overriding sentiments:

“If listing and buyer agent commissions are ultimately divorced, and the offer of compensation in the MLS is eliminated, how would you view this?”

The largest group (37.52%) see decoupled commissions as a challenge most agents and brokers will be able to navigate. Of all the categories, Agents on a Team were most likely to share this sentiment. 

Another significant percentage (34.92%) see commission decoupling as a healthy house cleaning that will purge the industry of many less productive or professional agents. Team Leaders were most likely to hold this view. 

The full Agent Sentiment Report, including all charts and tables with a complete breakdown of the survey results, is available for download on BAMx.