Posted September 4, 2024 in Uncategorized

Understanding NAR: What Is It, and What Do the New Changes Mean for Home Buyers?

If you’re in the market to buy a home, you’ve likely come across the term National Association of Realtors (NAR). But what exactly is NAR, and how do recent changes impact you as a home buyer? In this blog post, we’ll break down what NAR does, what the new changes mean, and what you should know before starting your home-buying journey.

What is NAR?

The National Association of Realtors (NAR) is the largest trade association in the United States, representing over 1.5 million real estate professionals, including agents, brokers, appraisers, and other industry participants. NAR members are known as Realtors®, and they are committed to following a strict Code of Ethics that sets them apart in the real estate industry.

NAR’s primary mission is to promote fair housing, ensure ethical behavior in the real estate industry, and provide ongoing education and resources to its members. The association also advocates for policies that protect property rights and promote sustainable homeownership.

What Are the New Changes, and How Do They Affect Home Buyers?

NAR recently implemented several significant changes aimed at increasing transparency and fairness in real estate transactions. These changes focus primarily on how agent commissions are disclosed and negotiated. Let’s explore how these changes benefit you as a home buyer:

1. Transparent Commissions: Previously, the details of how real estate agents were compensated were often hidden in the fine print, leaving many buyers unaware of the full costs associated with their transaction. The new changes require agents to clearly disclose their commission rates upfront, giving buyers a clearer understanding of what they are paying for and why. This transparency helps buyers make more informed decisions and eliminates potential surprises at closing.
2. Enhanced Negotiation Power: With more information at their disposal, buyers can now negotiate commission rates more freely with their agents. This means that buyers may have the opportunity to save on commission costs, ultimately lowering the overall cost of buying a home. By empowering buyers with this negotiation ability, NAR aims to create a more competitive and fair marketplace.
3. More Informed Choices: With greater transparency in commission structures and costs, buyers are better equipped to choose a Realtor® that aligns with their needs and budget. Knowing exactly what services are included and what they cost allows buyers to compare different agents and select the one that provides the best value for their money.

3 Things Home Buyers Should Know Before Shopping for Their Next Home

Buying a home is a big decision, and it’s essential to be well-prepared. Here are three crucial things you should know before you start your home-shopping journey:

1. Get Pre-Approved for a Mortgage: One of the most important steps before you start looking at homes is to get pre-approved for a mortgage. This process involves a lender reviewing your financial situation to determine how much they are willing to lend you. Getting pre-approved not only gives you a clear understanding of your budget but also shows sellers that you are a serious buyer, which can strengthen your offer when you find the right home.
2. Understand the Local Market: Real estate markets can vary significantly from one location to another. Take the time to research the market trends in the area where you want to buy. Look into average home prices, the number of homes for sale, and how quickly homes are selling. Understanding these factors will help you set realistic expectations and make more informed decisions when it comes to making an offer.
3. Know Your Must-Haves and Nice-to-Haves: Before you start visiting homes, make a list of what you absolutely need in a home (such as the number of bedrooms, proximity to work, or a good school district) and what would be nice to have (like a swimming pool or a finished basement). Having a clear idea of your priorities will help you stay focused during your search and avoid getting sidetracked by features that are less important to you.

The recent changes by NAR are designed to provide more transparency and fairness in the home-buying process. As a buyer, you now have more power to understand and negotiate the costs associated with your real estate transaction. By taking the time to get pre-approved, understanding your local market, and knowing your must-haves, you’ll be well-prepared to find the perfect home that meets your needs and budget.

Ready to start your home-buying journey? Armed with this knowledge, you’re set up for success! If you are thinking you’re ready for a new home, reach out to our team of mortgage experts to get started on your Pre-Approval, today!