That's me and every other REALTOR® by the way, and against several of our large real estate brands. Now this class action lawsuit has been already carrying on for several months and it will continue because of course like any good attorney will do. Soon as the first one was filed, you had copycats that got filed and now they're trying to consolidate themselves and it's kind of a mess. But what they're alleging bothers me on a lot of levels and I want to explain to you why. So if you're watching this and you're a REALTOR®, make sure that you know exactly what's going on. And if you are not a real tour watching this, you need to know too because there are some shady shenanigans that go on fussing about those of us who spend our days and nights trying our level best to help our neighbors with their largest financial instrument, which is their houses.
Cause y'all, most of us are not hugely wealthy people.We're not Warren Buffett's and Bill Gates. We're regular people trying to get some financial stability for retirement and have a place to call our own. And that's known as your house. And it's a big deal when you buy that house. Now once upon a time when you bought that house, you went to your REALTOR® who had a book full of houses. And if you wanna know what that old MLS book looked like, if you watched the 80s movie, the Money Pit with Tom Hanks and Shelley Long, their REALTOR® has an MLS book. And I remember that scene cause he like drips jelly out of his jelly donut onto, it's kind of hilarious. But we moved past that era into the era of the internet and so now as a buyer or seller of real estate, you can go to a lot of different online resources to find properties and to get data about those properties.
But the reality is this, once you're ready to buy the house or sell the house, you start running into all of the myriad things that you need advice and counsel on and you have questions about and you need resources and that's what a REALTOR® professional is.
We understand that real estate is different for every single buyer and every single seller. It is different from house to condo to land to commercial properties. It is different every single time, which is frankly one of the coolest parts about being aREALTOR® is every day is different. Well, this class action lawsuit lays out this claim and the claim is that buyer brokers are less important than they used to be. I totally disagree with that because the thing is, as REALTORS®, we work hard to make our jobs look easy and several of y'all even advertise with that button from staples that easy button.
In fact, 20 years ago we had less disclosure issue than do now. And so when you are buying or selling a property, you're not paying the REALTOR® for finding the house. You're paying them for their knowledge and expertise and guidance from the time you're ready to do something until it's yours or if you're selling until it's no longer yours. So what am I talking about? Well, mineral rights retention was not an issue 20 years ago like it is now. We know more than we used to know right on gas lead based paint. There's environmental issues that come and they get stronger as we learn more about the impact of environmental issues on houses.Buyers have a right to know and sellers have to know what they need to do if they're faced with it. The REALTOR® professional guides through that.
We've had flood zones that have changed many times becauseFEMA is still trying to figure out the best plan for flood insurance and flood zones. Your REALTOR® knows information about the impact on your house and frankly, by the way, all y'all should have flood insurance because if it rains at your house you need it. And those are things you don't really know until your REALTOR® reminds you of it. So buyer brokerage is hard. And by the way,REALTOR® spend so many hours with buyers and they have so much knowledge and expertise that they are putting in to play on behalf of their clients and yes, they do deserve to get paid for that. So the payment is also part of what this class action lawsuit alleges. It says that the public is clueless about howREALTOR® are paid. I disagree with that. I do believe the public is far more informed than this collection of class action lawyers would assert. Because I know that I, and many of my professional REALTOR® colleagues, and I can't say all because I don't know all of them, but the ones that I know when we sit down with the buyer and do a consultation, we explain how we're paid and there's options.
Maybe we're going to be paid a portion of the commission that's been agreed by the seller with their agent and it's been advertised in the multiple listing service. Maybe we're paid retainer fees, maybe the buyer is paying a finder's fee. There's different setups and frankly it's negotiated client by client and I do know that my REALTOR® colleagues explain this to people because we like it when they know the full story. You'll also see that if you pull up a dozen houses from the multiple listing service with your buyer, they pay different rates of commission. That's all right. We've talked about this with our clients and we have a plan in place, agent by agent, client by client. It's what we do. And then when I'm selling a house, I know that in my standard paperwork, it explains how much anybody's gonna be paid. And once the seller and I have agreed to a number, there's a second number, how much are we going to give to the buyer broker?
If any and this conversation happens house by house, now one of these consumer watchdog groups likes to fuss about how REALTOR®commissions are hidden and you can't find it on their websites. Well duh, we can't put it on our websites because of Sherman anti trust, then we will be of colluding and we don't do that. I know that I, myself and the agents that I know are talking client by client, figuring out what makes sense based on their needs, based on the value and the services we're going to provide. So we don't put the numbers out there. In fact, if I go to any of these lawyers' websites, it certainly doesn't say what they're getting paid per hour because I'm fairly sure that it changes based on the level of expertise and what's being provided and the length of time involved. So you've got to remember that there's a lot of moving pieces because every buyer is different.
I mean you start adding it up. It's different every single time, which is the proof that there is no standard anything out there.They also allege that we are not competitive as a profession, which is pretty laughable when we have 1.3 8 million REALTORS®. That doesn't even include the licensees who have chosen not to join our professional association and are not thereby bound by the REALTOR® code of ethics. The 1.3 8 million REALTORS® out there, they are bound by the code of ethics and they're also striving every day for a higher level of professionalism because I think REALTORS® understand what a big deal it is, the work that they're doing and how critical it is to our people in our communities who happened to be our neighbors. Because REALTORS®live amongst you, y'all. You're not talking about some big giant conglomerate somewhere where you're attacking their funds.
We you go after REALTORS®. You're going after neighbors.And the REALTORS® that I know are so entrenched invested in their communities, they get the impact on property values of changes to schools, zones to changes in the roads to what happens if there's negative regulatory and legislative issues that happen on the local political level or the state level or the Federal level. And REALTORS® are dialed in to all those things. And in fact their hearts are as big as anything else because they're very concerned about things like housing affordability. And how do we create opportunities for people who never knew that they could own a home because y'all houses provide financial stability. So if I look at this class action lawsuit and how it's fussing at REALTORS®, they really don't understand that. What we do for a lot of people is show them the way where they could have a future.
So speaking of that, if you look at what the intended goals are, that you may have REALTORS® paid hourly or that all buyers would have to pay out of pocket. And again, you can negotiate a client by client, but if you go down that road, then what you're going to be facing is a giantly disproportionately negative impact on our first time buyers and our lower income and lower down payment communities because they may not have the cash to hire a REALTORS® out of their own pocket. And frankly y'all, that's the piece of the public that needs a REALTORS®'s advice more than anybody. In fact, I know that I and other realtors, we love serving people who are buying their first house and we know we're not going to get paid a great sum of money for it in many instances. But the satisfaction is gigantic because understand this based on data from the national association of realtors and from our economic forecasters, Lawrence Yun being our Chief Economist, the renter, average renter over their lifetime of work, when they get to retirement, they've saved five to$7,000 if they're lucky, your average homeowner over that same lifetime when they get to retirement, has an average of $200,000 in savings.
And yes, it's illiquid because it's in the form of their residents, but they've got something to give them stability that they could sell or get an equity line or a reverse mortgage. They've got access to some kind of funds in the event that they need it and their kids are more likely to have gone on to bigger things, lower instances of teenage pregnancy and drug use and just generally more stability in our communities. And that's what REALTORS® are doing every day. When we educate our neighbors and provide opportunities so we are not in some ugly closed collusion filled world in real estate. I know who realtors are and I know what we do and in fact our job as REALTORS® is to tell our job a little bit more importantly because we have told people our jobs are easy because you've worked so hard to carry the burden on yourself.
Now it's time to let the public know how hard the job is that you do and how hard you work for the commission dollars that you may or may not be paid.
Depending on if a transaction comes to fruition. Let people know that you do have conversations about buyer compensation and seller compensation and that it's client by client. Let people know how involved you are in your community and all that you're doing to ensure access to safe and secure housing for your neighbors and that you're willing to be the one who can show the pathway that they could then walk down if that's their choice. Let the public know too that the MLS multiple listing service that we have is absolutely a gift to a free market place. Because I know that in my area, which is greater Charlotte, North Carolina, at any given time, there are thousands of houses in the MLS.
I could also not handle every buyer because for every listing you've got multiples of buyers in different places in the life cycle.And so if I know that the market's too big for me, then a market where REALTORS® can collaborate with each other and share data and share information becomes an amazing resource for my buyers and for my sellers because I can show my buyers everything and they can find what makes the most sense for them. And for sellers, they can be exposed to every buyer and that's gonna allow them to be open to the marketplace where more buyers can find their house and hopefully the right buyer finds it sooner rather than later. This MLS system was not intended to be a closed loop where you have only a few houses and only a few people participating.
The more houses that are in it and the more REALTORS® that participate, the better the impact for the buyer and seller and for the overall community. So understand who we are and what we're doing and help others understand that our goal as an Association is that judges and juries are going to see how flawed this argument is in this class action lawsuit and that they will dismiss it because it doesn't reflect who we are or what we're doing.
And you as a REALTOR® Member need to take the pride in what you do and understand how important your role is because frankly, y'all, without your guidance, there are people that would not as successfully have sold or purchased real estate in this country, which is the best opportunity for property rights, which we want to preserve and protect for every one of our neighbors, whether they're buying or selling today or 10 years in the future. We protect those opportunities.
If you have other questions about the class action lawsuit, please visit the hub, which is the REALTOR® Resource for Volunteers. Reach out to me at any time and I can connect you to the right people on staff who have all of the answers. But most importantly, thanks for paying attention and thanks for being a REALTOR® who's engaged and doing great things in your community because y'all, I love where I live. I know that you love where you live and nobody tells that story better than local REALTORS®.
~ Leigh Thomas Brown
REALTOR®. Author. Coach. Keynote speaker. Leigh Brown is laser-focused on inspiring people to be better, strive for more, and to take the reins and lead!
Learn more about me at www.leighbrown.com
𝘾𝙊𝙉𝙉𝙀𝘾𝙏 𝙒𝙄𝙏𝙃 𝙈𝙀
Things are finally starting to return to some kind of normal, and I am so excited to see your 😃 faces at NAR's 2021 REALTORS® Conference & Expo. Tune in for my recommended must-have items to pack and how NOT to feel overwhelmed as you prepare. This is your official (ok, FINE, unofficial) guide to packing and prepping for #NARAnnual (or any big convention or trip in life).
This classic Southern recipe has many variations that are easy to make and delivers a refreshing sweet, and tart flavor that's perfect for hot summer days!
It can be completely overwhelming to attend any week-long series of meetings. Never fear! Take a peek inside my closet and get all the insider tips to making this week the most effective and productive use of your time as you make your way to DC to do the work that our clients may never see but is absolutely critical to the future of homeownership, property rights, and entrepreneurism.