What’s The Tea with 4D? 🍵

Last week, I shared my thoughts on the feeling of uncertainty in the air. And as you may have heard, there have been quite significant developments in the real estate world.

The National Association of Realtors, the largest trade entity of its kind in the US boasting 1.5 million members, settled a lawsuit to the tune of $418 million. The issue? The lawsuit alleged that NAR has been colluding with MLS services and brokers to keep real estate commissions high by requiring sellers to pay commissions to both listing and buyer agents, typically running at six percent.

Some industry experts are touting the decision as a landmark and one that will "shake up" the real estate industry forever. Some have even postulated that this will somehow lower home prices since sellers may opt to not pay buyer agents, making them able to lower their listing prices and thereby shifting overall pricing.

I tend to disagree. The reality is that the market pricing is set by the market. Inventory, demand, interest rates, and the economy all play a pivotal role in the real estate market. I have deeper concerns about how this will impact some buyers, particularly first-time buyers.

If sellers move towards refusing to pay buyer agents, that will place the expense of representation on to buyers. First-time buyers are already working hard to come up with their down payments, closing costs, the cost of inspections, etc. Adding another expense to their plate seems like the worst-case scenario.

Will that leave some buyers shopping without representation? Possibly. And that notion is truly concerning. Real estate agents are experts in the market, contracts, and negotiation. All things needed by both buyers and sellers.

So, what is the answer to how this will impact the real estate world? That remains to be seen. Perhaps this shift will open up new ways of doing business, new models, or a new structure for real estate professionals to adapt to. Sometimes amid what can feel chaotic, creative solutions that benefit all can be born.

What I know for certain is that this decision won’t impact my way of doing business. I will continue to represent my sellers and buyers at the highest level possible with integrity and transparency. And as long as agents focus on clients and work hard to achieve the best outcomes on their behalf, our industry will continue to grow, change, and benefit—even when it’s shaken to the core.

For realtors or those connected to the real estate realm, I invite you to download my new e-book on Amazon: 'Find Your Flow In Real Estate: Seven Tips For Staying Cool, Calm, and Collected.' It's a thoughtfully curated resource aimed at empowering and enriching your life, both personally and professionally.

Your Home Is a Powerful Investment

Going back to 2023, there was a lot of talk about a possible recession that would cause the housing market to crash. Some in the media were even forecasting home prices would drop by as much as 10-20%—and that might have made you feel a bit unsure about buying a home.

But here’s what actually happened: home prices went up more than usual. Brian D. Luke, Head of Commodities at S&P Dow Jones Indices, explains:

To put last year’s growth into context, the graph below uses data from Freddie Mac on how home prices have changed each year going back to 1980. The dotted line shows the long-term average for appreciation:

The big takeaway? Home prices almost always go up, and will continue to do so in the upcoming years.

As an article from Forbes says:

In fact, since 1980, the only time home prices dropped was during the housing market crash (shown in red in the graph above). Fortunately, the market today isn’t like it was in 2008. For starters, there aren’t enough available homes to meet buyer demand right now.

On top of that, homeowners have a tremendous amount of equity, so they’re on much stronger footing than they were back then. That means there won’t be a wave of foreclosures that causes prices to fall.

The fact that home values went up every single year except those four in red is why owning a home can be one of the smartest moves you can make. When you’re a homeowner, you own something that typically becomes more valuable over time. As your home’s value appreciates, your net worth will continue to grow over time, providing you with more financial stability and long-term wealth.

Do you have any questions about the local market? Perhaps you're wondering how much equity you've built up in your current home? I'm here to provide clarity and guidance. Let's meet for coffee and discuss your inquiries—your first cup is my treat! ☕️

To arrange a coffee meetup with me, just click the button below to select a date and time that fits your schedule. Once you've booked, I'll reach out directly to confirm the location. Looking forward to chatting with you soon. 😊