TRUE OR FALSE? SORTING OUT THE NAR SETTLEMENT
Recent headlines regarding the residential real estate industry and its practices have created a state of confusion. We’d like to provide some clarity so our customers, friends, and communities can cut through the noise and better understand what has changed and what has not changed when it comes to selling and buying homes. On March 15, the National Association of Realtors reached a preliminary settlement with class action plaintiffs in a civil lawsuit known as the Sitzer/Burnett case. This case challenged the business practice of the home seller hiring a real estate agent/broker to represent them for a commission-based fee, and then offering compensation – via an association-owned MLS (multiple listing service) – to the agent/broker who represents the buyer in the sale.
Here’s what is TRUE about the impact of the settlement:
MLS systems can no longer show what a seller is offering for buyer’s agent compensation.
- Pending final approval of the settlement, any seller-offered commission to a buyer’s agent is communicated between the agents, and then negotiated as part of the purchase contract between buyer and seller. No display of offered compensation is allowed to be listed in the MLS.
Buyers must have a signed agreement with a buyer’s agent.
- Prior to showing any property, a buyer’s agent must have a written agreement with the buyer that clearly outlines the fee that the buyer’s agent is charging. This fee can still be determined in various ways, including negotiation with the seller, paid by the buyer, or a combination of both. Buyers will need a clear understanding of how their agent is compensated and should know what services they are receiving in exchange for that compensation.
All commissions and concessions are fully negotiable in the purchase contract.
- A buyer and seller must agree on all the terms of the purchase, including how buyer’s agent commissions are paid, and any concessions the buyer requests.
Here’s what’s FALSE:
Sellers are prohibited from providing compensation to the buyer’s broker/agent.
- This is false. Sellers ultimately get a choice if they want to provide compensation to a buyer’s broker/agent. A seller will need to explore with their listing agent to come up with the best strategy for attracting buyers, and achieving the end goal of selling their home. Buyers may be more interested in homes that do not increase their financial burden, such as paying for the service of a buyer’s agent. Sellers must also weigh the risks and potential liability of having an unrepresented buyer try to navigate the complexities of the transaction.
Realtors are forced to reduce their compensation.
- Also false. A Realtor must disclose their fee/commission for services when representing either a buyer or seller. A written agreement defines those fees and how the agent will be paid. A real estate agent has the right to establish their fee for service. It is important for both buyers and sellers to understand what services they are receiving in exchange for the fee they are paying.
Housing will become more affordable as a result of the settlement.
- False again. Commissions are one of many expenses in a real estate transaction. Home prices are fundamentally controlled by supply and demand economics. A change in negotiated real estate commissions paid is a part of a wide range of expenses, including closing costs, property taxes, mortgage-related expenses, title fees, insurance, and association fees.
While we are still waiting on final court approval on these settlements, the primary message we want to convey is that real estate and housing will continue to be bought and sold in the United States. We believe buying and selling real estate has not become easier due to these changes but has introduced more transactional friction. And when anything becomes more difficult, the need for a trusted advisor to help you navigate the nuances of a complex process becomes more pronounced – no different than sorting out the complexities of tax law, accounting, medical benefits, etc. Realtors are here to continually serve you and our communities to reduce that friction and provide the clarity needed to accomplish your dreams and goals.
IT’S FINALLY TIME TO PLANT TOMATOES
Biting into a vine-ripened tomato is one of the summer’s most indulgent sensations.
You likely have heard it is safe to plant after Mother’s Day. But do yourself – and your tomatoes and peppers – a favor and wait. CSU’s Colorado Master Gardeners offer this advice:
For optimal transplant, tomatoes need warm temperatures: above 52ºF at night and above 60ºF during the day. A week of cool daytime temperatures (below 55ºF) will stunt plants, reducing yields. With these warm temperature requirements, planting time along the Colorado Front Range is typically late May.
The ideal tomato transplant is dark “grass” green and six to eight inches tall. The stem is about pencil size in diameter. Dig a hole deep enough to plant 1/2 to 2/3 of the stem so the “white bumps” can form new roots.
If shopping in warm greenhouse conditions, tomato plants are often leggy, and stem roots have begun to form.
Plant these taller, leggy transplants horizontally.
Dig a trench 2” to 3” deep. Place the plant horizontally with only the top two to three sets of leaves showing above the soil. Pinch off other lower leaves below the soil line before planting. These leggy plants readily root out along the stem in the warm soil near the surface, supporting rapid growth.
WHAT TOMATO VARIETIES DO BEST IN NORTHERN COLORADO?
To answer this question, members of the CSU Extension Master Gardener program in Larimer County, in cooperation with the CSU Specialty Crops program, conducted a trial with 12 tomato varieties.
After evaluating two years of data, Hybrid New Girl had the best overall flavor and sweetness, followed closely by Damsel and New Girl (tie) and Moskvich. Chef’s Choice Black won the sweetness category in 2019, though it was in the middle of the pack more recently.
Hybrid New Girl was also the earliest maturing and had the highest fruit yield in the field trials.
For container gardening Patio Choice Yellow matured the earliest and garnered the highest yield.
To view the full Larimer County Vegetable Trials results, click the link below.
COLORADO KEEPS ATTRACTING NEWCOMERS
Perhaps it will come as no surprise to you, but a recent analysis of migration patterns tells us that Colorado ranks high on the list of states where Americans were moving to in 2023.
A report by the moving company moveBuddha shows that Colorado’s in-to-out ratio was 1.34 last year. That means for every 100 moves out of the state, there were 134 moves in from another state. That ranks No. 11 among all states for a positive in-to-out ratio. (Note: A “move” could be one person or a larger family.)
Colorado popularity as a move-in destination would seem to correspond to the state’s relative economic health, and the availability of jobs. In fact, the latest Leeds Business Confidence Index – which assesses how business leaders feel about the state’s economic climate – is on the upswing.
On a range of 1-100 (below 50 = pessimistic, 50 = neutral, above 50 = optimistic) the Leeds Index moved into positive territory for the second quarter of 2024 at 53.7 The index score had previously hovered in pessimistic territory since early 2022.
REAL ESTATE BY NUMBERS
- $6.1 million. Sale price for the Quality Inn & Suites in east Loveland. The 62-room hotel is located at 1500 Cheyenne Ave., located across U.S. Highway 34 from the Walmart Supercenter.
- $175.4 million. Estimated investment for a new academic building on the University of Colorado campus. As planned, contractors will break ground for the 79,200-square-foot building in October. It will be by the chemistry and applied mathematics departments.
- 175. Number of apartments proposed for a new two-building development in the Downtown River District of Fort Collins. One of the buildings will also include 2,300 square feet of retail space.
- $14 million. Sale price for a 105.79-acre development lot in Johnstown, located on the west side of Interstate 25. The site is located north of Colorado Highway 402, near the Loveland city limits. The same owner is currently working on two mixed-use (residential plus commercial) in Johnstown on the east side of I-25.
- 241. Total acreage for The River at Overland Crossing, a proposed development southwest of Berthoud. As planned, the project includes 45 two-acre residential lots. The site is located near the intersection of Larimer County Roads 4 and 24.
- $4.8 million. Price the Estes Park Housing Authority paid to buy a 16-unit apartment complex, located at 507 Grand Estates on the east side of Estes Park. As planned, the units will help the community provide affordable housing for local workers.
- $396,000. List price for a 1.98-acre building site in the new Northwest Colorado Business Park across County Road, located near the Yampa Valley Regional Airport in Hayden. In all, 10 development lots – ranging up to 4.98 acres – were available for sale as of April 22, according to the business park’s website.
- 62 percent. The one-year increase in the number of build-to-rent homes completed across the country in 2023, representing about 25,000 homes and $7.5 billion in investment, according to real estate service CoStar.
- 6. Acres annexed by the town of Johnstown on the west side of Interstate 25, across the highway from the Johnson’s Corner truckstop. The site is home to the long-vacant Nickerson Farms restaurant building, first constructed in 1968.