Article Courtesy of: Inman News
By: Marian McPherson

Thirty-nine percent of agents plan to switch brokerages in 2024, according to Coldwell Banker Real Estate's latest survey, citing favorable commission structures and strong lead gen systems

In the survey of 1,500 agents, 39 percent said they plan to switch brokerages. That’s a 56 percent increase from 2023 when 25 percent of agents said the same thing. Of the 852 respondents affiliated with Coldwell Banker, the growth in agents who said they plan to move increased marginally from 2023 (30 percent) to 2024 (31 percent).

“Given today’s challenging landscape, many agents have become more open to leaving their current company and working with a partner who best supports their personal and career goals,” Coldwell Banker Affiliates President Jason Waugh said in a written statement.

For agents who plan to switch brokerages this year, wanting more referrals and leads (52 percent), better training and education opportunities (44 percent), a better commission structure (42 percent) and better team support (42 percent) are the driving factors behind their decision.

When it comes to agent priorities, brand trust (93 percent), marketing and advertising support (88 percent), a strong brand image (85 percent), recognizability (83 percent) and leading-edge technology and tools (82 percent) topped the list.

Respondents affiliated with Coldwell Banker were more likely to cite brand trust (97 percent), marketing and advertising support (95 percent), strong brand image (95 percent), recognizability (95 percent), and leading-edge technology and tools (92 percent) as a priority when considering brokerage choice.

Coldwell Banker agents also had an increased interest in a brokerage’s luxury real estate expertise (66 percent in 2024 vs. 51 percent in 2023) and the strength of their global footprint (65 percent vs. 50 percent).

Waugh said he’s proud of the results from respondents affiliated with Coldwell Banker as the company heads toward its 118th anniversary in August.

“I’m proud to say that the Coldwell Banker network continues to find value in our products, services and resources as well as their partnership with the brand,” he said. “Our strong reputation, powerful brand image and global network equip affiliated agents to maintain a commanding presence in the marketplace.”

Coldwell Banker’s survey comes in the middle of a recruiting frenzy centered around attracting high-quality agents who have the experience and skills to navigate strong market headwinds.

Of the 1,009 agents who responded to the March Inman Intel Index, 71 percent said they received recruiting offers during the first quarter of the year. Nineteen percent said they received a recruiting call once a week, and 32 percent said they received a call once a month.

Coldwell Banker Realty president and CEO Kamini Lane offered her insights on Intel’s findings, saying a slower market stokes competition and pushes brokerages to supercharge their retention and recruitment efforts.

“When the market contracts, the cream rises to the top and the best agents are the ones who are going to get the fewer listings [that remain],” she told Intel in April. “Because of that dynamic, we naturally look for the better and best agents.”

Article Courtesy of: Inman News

Judge Stephen R. Bough ruled that the sweeping changes NAR agreed to were 'fair, reasonable and adequate' and set a final approval hearing for November

Judge Stephen R. Bough, who presided over the landmark Sitzer | Burnett class action lawsuit, granted preliminary approval to the proposed settlement reached last month by the National Association of Realtors® in an order released on Tuesday.  The order makes it increasingly likely that Realtors® will operate under new rules within just a few months at which time NAR has agreed to implement a set of changes governing the industry.  Bough ruled that the sweeping changes proposed within the settlement agreement were “fair, reasonable and adequate” and set a November hearing for final approval.

Under the terms of the settlement, NAR agreed to establish rules preventing the display of cooperative compensation within the multiple listing services by mid-July. In addition, it will require MLS participants working with buyers to enter into written buyer representation agreements prior ro touring a home. NAR will also pay $418 million over the next four years, and plaintiffs’ attorneys said in a Friday filing the settlement amounted to “greater than 50 [percent] of NAR’s net assets.”

The rule changes are widely expected to provide added transparency into how real estate agents are compensated, and some experts believe the changes will lead to more negotiation around real estate commissions paid by buyers and sellers in the near future.

NAR’s proposed settlement offered blanket protection from a growing list of lawsuits filed by home sellers and homebuyers across the country in the months following the Sitzer verdict.

In a statement, NAR spokesman Mantill Williams said the organization was happy with Bough’s order.  “It has always been NAR’s goal to resolve this litigation in a way that preserves consumer choice and protects our members to the greatest extent possible,” Williams said. “This proposed settlement achieves both of those goals and provides a path for us to move forward and continue our work to preserve, protect and advance the right to real property for all.”

The lawsuits largely centered around what was known as the Participation Rule, which required listing brokers to make blanket, unilateral offers of compensation to buyer brokers in order to submit a listing in a Realtor-affiliated multiple listing service.

The rule changes envisioned by the settlement will also require buyer’s agents to obtain a signed representation agreement with clients before touring homes.

The settlement didn’t include HomeServices of America or other brokerages that conducted over $2 billion in transaction volume in 2022. That left out more than 90 brokerages. Ultimately, however, NAR said its proposed settlement would protect over 1 million of its nearly 1.5 million members. HomeServices has vowed to fight the Sitzer verdict.

Brokerages and MLSs not covered by the proposed settlement have until June 18 to take action and be covered.

Bough also agreed to certify the proposed settlement class, which would include the following:
• Homes listed on Moehrl MLSs: March 6, 2015, to date of Class Notice;
• Homes listed on Burnett MLSs: April 29, 2014, to date of Class Notice;
• Homes listed on MLS PIN: December 17, 2016, to date of Class Notice;
• Homes in Arkansas, Kentucky, and Missouri, but not on the Moehrl MLSs, the Burnett MLSs, or MLS PIN MLS: October 31, 2018, to date of Class Notice;
• Homes in Alabama, Georgia, Indiana, Maine, Michigan, Minnesota, New Jersey, Pennsylvania, Tennessee, Vermont, Wisconsin, and Wyoming, but not on the Moehrl MLSs, the Burnett MLSs, or PIN MLS: October 31, 2017, to date of Class Notice;
• For all other homes: October 31, 2019, to date of Class Notice.

Watch now

Following the Oct. 31 verdict, some of the largest companies in real estate have reached proposed settlements with plaintiffs in various lawsuits. More settlements are expected to come.

“Every day we continue to engage in settlement conversations and settlements with companies,” Michael Ketchmark, the lead plaintiffs’ attorney in the Sitzer case, told Inman earlier this month.

On Tuesday, Ketchmark told Inman he was happy to see the preliminary approval.  “It’s a huge step towards bringing about the necessary relief to homeowners nationwide,” Ketchmark said. “NAR negotiated a way for large brokers, and we reach settlements almost daily. The long-engrained mandatory compensation is finally dead.”

The approval isn’t the end of the scrutiny NAR faces. Earlier this month, an appeals court ruled that the U.S. Department of Justice could reopen its investigation into NAR’s cooperative compensation rule, also known as the Participation Rule, which it began investigating five years ago.

Article Courtesy of: Inman News
By: Jimmy Burgess

Change is coming, so it's time to make sure you're leaning into the potential of a listings-based business, Jimmy Burgess writes. Nothing helps do that better than geographic farming

When change happens, the key to success is to find the most effective strategy possible that will generate results and execute on it. The time-tested strategy of geographical farming worked in the past, is working now, and will continue to work in the future.

In this article, I’ll share the step-by-step blueprint for success that will develop a consistent flow of listing opportunities for your business.

Step 1: Identifying the right area

Success or failure through geographical farming is determined early on by choosing the best area to farm. The first question you should ask is whether there is a dominant agent in the neighborhood. I determine this by totaling the number of listings closed in the past 12 months and the current active listings.

I prefer to start a new farm in a neighborhood where there isn’t any one agent who has active listings or sold listings from the previous 12 months that exceed 10 percent of the total listing opportunities for the neighborhood. If you find a neighborhood like this, you have identified one that is ripe for your marketing to make you the dominant agent for that area over the next 12 months.

If there is someone who has between 10 percent and 20 percent of the sold and currently active listings, then the neighborhood still has potential for you to farm, but make sure you know where your breakeven number is for the investment you will be making.

Step 2: Financial evaluation

Finding the perfect farm area involves not just finding a neighborhood you love, but also identifying one that provides an opportunity for you to add money to your bottom line. Consistency is key to becoming the dominant agent for your area, so we want to start with a 12-month commitment to marketing to the neighborhood.

I like to use a budgeted amount of $2 per month per home or $24 per home for the year. I will go into what these expenses will be shortly, but for now, let’s see where our breakeven point will be.

For this example, let’s assume we have 400 homes in the neighborhood. The $24 per home, per year budget multiplied by 400 homes means we will have an estimated expenditure for the year of $9,600.

If the average sales price in the neighborhood is $400,000 and your listing side commission is 3 percent, then you could anticipate an average listing side gross commission rate of $12,000. If you have an 80 percent split with your brokerage, then your net proceeds after the split would be $9,600. Meaning, for this example, you would need to list and sell one home in the neighborhood during the year to break even.

I also like to evaluate the opportunity in the neighborhood. If the average homeowner stays in a home for 11 years, then that means the neighborhood should have roughly 9 percent of the homes in the neighborhood selling each year. Based on 400 homes in the neighborhood, this means we can anticipate roughly 36 homes in an average year being listed and sold.

If you execute on the marketing in the following section, you should be able to list over 10 percent of the available listings in a neighborhood over the next 12 months. That means the estimated minimum results you should expect for this farm would be to list 4 homes in the coming year.

If we are being conservative and say you only sell three of the four homes you list, then based on our average net commission from above, this means your $9,600 budgeted expense for the year would generate $28,800 ($9,600 average net commission times three homes sold) or a net income amount of $19,200.

With the breakeven point of one sale, no dominant agent in the neighborhood, and a conservative expectation of listing 10 percent of the available listings, generating a return of $19,200, this appears to be a farm area with a lot of upside potential.

Step 3: Consistent direct mail

The marketing plan for the neighborhood will determine whether the farming efforts are successful or not. Remember that we budgeted for $2 per home per month. The consistency of monthly, at a minimum, mailers to the neighborhood is foundational to your success.

The monthly mailers I suggest are a mix of postcards or direct mail letters. I like a quarterly sales report or card that goes out four times a year. The January one will be a year in review; the April, July and October ones will be reports for the quarterly sales activity.

These cards should be clean and easy to understand with a section for homes currently for sale, under contract or that sold during the time this card is reporting on. It should include the address, number of bedrooms and bathrooms, square footage of the home, list/sales price, and date sold if closed.

These cards should also include a summary of the activity levels and any market details that encourage potential sellers to call you for additional details. Every mailer we send should have a strong call to action for additional details or a free, no-obligation home valuation analysis of their home.

The additional eight months of monthly mailers will be a mix of different marketing pieces. The following are examples of the types of mailers you can choose from, or you can supplement with some of your own ideas.

I recommend a review/recommendation piece twice a year. These should share a quote from your client about how you helped them sell their home and the service they received. The effectiveness of these pieces is increased if you can include a picture of your clients and even more effective if the home you sold for them is in the neighborhood you are farming.

Other mail alternatives for the additional months should be a mix of local service provider cards, community calendars, just listed cards, just sold cards and even an “About Me” card so the owners get to know you.

Step 4: Next-level ideas for the farm area

Mail is the foundation, but additional touch points are what turn good farms into great farms. The $2 per month per house I mentioned during the budgeting portion will not be completely absorbed each month via mail costs. These additional funds will be spent on quarterly activities or large events every six months to increase your recognition in the neighborhood.

The first of these additional activities should be an evergreen video about the community. This video should include the history of the community, the number of homes, the size range of homes, amenities and a call to action to reach out to you for additional details. Not only is this a great lead attracter, but it also shows your commitment to and expertise on the neighborhood to the owners in the farm area.

Other options for special events can include a food truck night you sponsor, a family photography or pet photography day in the neighborhood or even a fall festival in the community park. The key is to serve the neighbors and show your commitment as the neighborhood agent of choice.

In addition to the special events, your presence in the neighborhood is also a key to success. Glennda Baker, out of Atlanta, Georgia, said she began her career farming a luxury neighborhood while living in an apartment. Not only did she know the neighborhood inside and out, but she would drive over to the neighborhood she was farming in the afternoons to walk around it, pushing her baby in a stroller so that she could be visible and meet the owners.

Why not walk your dog or take an afternoon walk in your targeted area? Your presence will make a difference.

Step 5: Leverage your listings

If you follow these steps, you will generate listings. Once you get that first listing, leverage it to audition for your next listing. Spend extra on professional photography and videography of the home that you can share with the neighbors.

Send just-listed and just-sold cards, but with a twist. Instead of typical postcards, tell the story of listing the home and the marketing you did, and provide bullet points showing numbers and results.

Door-knock or call neighbors to let them know you are hosting an open house. Put up clean, professional signs with take-one boxes and QR codes for easy access to the marketing videos you produced of the home.

Always look for ways to stand out. Mary Maloney, out of San Diego, California, utilizes the take-one box in a unique way once a listing she has goes into escrow. She asks the sellers for a review of their experience and has professional photos taken of the family providing her with the review.

Once the home is in escrow, she creates a two-sided flyer that states the home is in escrow with the owner’s photo and review. The second side of the flyer provides other properties they have listed and a strong call to action to call Maloney if they are considering buying or selling.

By marketing the listings you take at the highest level possible, you will be rewarded with additional listings.

With the changes coming, now is the time to build a consistent listing lead flow for your business. Nothing accomplishes that goal better than geographical farming.

Jimmy Burgess is the CEO for Berkshire Hathaway HomeServices Beach Properties of Florida in Northwest Florida.

 Aricle Courtesy of: RIS Media
By: Jesse Williams

Citing the recent National Association of REALTORS® (NAR) settlement agreement, a panel of six judges today denied an attempt by plaintiffs in commission-focused class-action lawsuits to consolidate all the copycat cases under one judge, saying that the “procedural posture of the litigation” makes that effort inappropriate.

“After settlement proceedings conclude, and it becomes evident how many claims and parties still remain and the extent to which they overlap, if at all, it may be that formal centralization is needed or, perhaps, informal coordination efforts can adequately address any duplicative pretrial proceedings,” wrote Judge Karen Caldwell, chair of the Judicial Panel on Multidistrict Litigation (MDL), in a four-page opinion.

The ruling leaves the 20-something Burnett copycat cases filed all over the country to proceed under different judges, schedules and procedures—a scenario that will almost certainly turn out to be a mixed bag for the real estate industry at large, as different brokerages continue to litigate claims all across the country filed by recent homebuyers and sellers alleging that real estate rules violated antitrust laws.

Caldwell notes that both defendants and plaintiffs disagreed on nearly every part of the consolidation effort, with some even switching their position after a hearing late last month, in which the MDL heard oral arguments from nearly a dozen entities involved in the lawsuits.

Those flip-flops, along with the NAR settlement, appear to have pushed the MDL to stay out of real estate commission litigation for now, with Caldwell further pointing out that brokerages left out of the NAR agreement might still opt in, making the choice to consolidate (and where to do so) even more uncertain.

“Given the broad contours of this new settlement agreement and the changing landscape of the parties’ positions on centralization, we think it wise to deny centralization at this time. The (NAR) settlement may well resolve at least some claims in this litigation, if not many. We cannot speculate on the number of parties and claims that will remain once this and any other settlements are approved,” she wrote.

Initially filed by the same plaintiffs behind Burnett back in December, the effort to consolidate commission cases appeared to be a straightforward one, with NAR supporting centralization of cases as well (though it was later forced to withdraw its participation in the MDL proceedings by the settlement agreement).

Other brokerages large and small also weighed in, with many taking no position and others targeting specific districts based on geographical convenience and other factors.

The MDL also considered whether to include buyer and seller cases together, along with what Caldwell refers to as “tag-along” cases—those not involving NAR or NAR-affiliated entities.

Exactly what effect consolidation would have had on the outcome of all these disparate lawsuits remains unclear—and could remain a mystery, although Caldwell made it clear that circumstances could change in the future, and was explicit that the panel was denying the consolidation effort on technical grounds rather than on its merits.

“We deny this motion based on the procedural posture of the litigation and, therefore, do not reach the issue of whether centralization would otherwise be appropriate here if these settlements had not been reached,” she wrote.

MAA Supplier Spotlight: Kitchen and Floor Decor!

Read all about Kitchen and Floor Decor, this month's Supplier Spotlight

Legislation to allow communities the ability to impose a new sales tax on homes and commercial properties is getting increased attention on Beacon Hill, where two prominent leaders in the Massachusetts House of Representatives recently expressed their interest in considering measures to create transfer taxes.  That’s concerning, given that transfer taxes would add to the already high cost of housing in Greater Boston and create an additional obstacle to housing production.  It’s also problematic since this type of tax discriminates against home buyers and sellers, singling them out to pay for initiatives that benefit the community at-large.  

However, nearly one dozen communities – including Arlington, Boston, Cambridge, Concord, Medford and Somerville – have introduced or are considering bills to impose a new tax on residential and commercial real estate transactions, and Gov. Healey’s housing bond bill, aka the Affordable Homes Act, includes language that would allow any community in the state to create a new tax of 0.5% - 2% on the portion of a home or commercial building sold that exceeds $1 million.  The Greater Boston Real Estate Board and REALTOR® Association oppose the passage of these measures, and you can add your voice to urge their defeat as well.  To participate, simply respond to the recent Call-For-Action on Transfer Taxes issued by the Massachusetts Association of REALTORS® urging state legislators to oppose the creation of a new sales tax on homes and commercial property. By doing so,  a pre-drafted letter outlining industry opposition to the various legislative proposals will be sent to your state senator and representative.