Anthony Lamacchia Discusses Real Estate Settlement on Boston25 News

Gene Lavanchy: 743 will not be business as usual in the world of residential real estate. Buyers and sellers will be in a state of confusion until things settle down a bit. But as of this weekend, the way commissions are paid to realtors has changed and will affect how you buy or sell a home. We turn to Anthony Lamacchia of Lamacchia Realty to help us all sort it out. Anthony, good morning as always. So this change is part of that $418 million settlement of a class action lawsuit. What is the most important thing people have to know about how this is going to affect them?

Anthony Lamacchia: Well, good morning, Gene. Thank you for having me. Number one, it is more important than absolutely ever before in history that people work with a realtor and a real estate brokerage that know what they’re doing. Unfortunately, there are a few out there who are not taking this as seriously as they should, but the masses are. So if you’re a buyer, if you’re a seller, you’ve got to make sure you’re working with a realtor that’s totally up on the new rules, totally up on the way that things should be done. And if you do that, you’ll be just fine. People are going to continue buying and selling. There’s going to be no interruption in that.

Gene Lavanchy: So let’s talk about what this means as a buyer. It’s possible, even likely, that a buyer will now have to pay their agent out of their own pocket in a lot of circumstances. Is that correct?

Anthony Lamacchia: Well, the idea of a buyer paying their agent out of their own pocket is something that was always a possibility. That got spun up a lot more in the media by the plaintiff’s attorney who felt that was a good talking point because they wanted sellers to hear that and say, oh, then I don’t have to pay it. That’s not always how it works. And you can’t just take a realtor fee, a real estate fee, and put it on top of someone’s mortgage. It doesn’t work that way. The mortgage rules don’t allow it. But these things will be negotiated within the transaction in many cases. In some cases, buyer may pay out of pocket. In some cases, buyer may request that the seller provide a closing cost credit. And in many cases, I believe, buyers will request that seller pay their buyer brokerage fee within the transaction, and they’ll request that when they submit an offer on a home.

Gene Lavanchy: So a buyer could hear Anthony say, well, wait a minute. Now I’m hearing I’m going to have to pay a realtor here if I have someone represent me as a buyer. So I’m just going to go it alone. I’ll go to open houses. I’ll call the listing agent, not use a broker. There’s nothing from stopping someone doing from that, correct?

Anthony Lamacchia: That’s correct. And we have not seen that increase. We thought that may increase when this all started last October. But the fact is, the vast majority of consumers want their own agent. I mean, going directly to the listing broker, it’s not a terrible thing to do. But if you and I were going to court against one another, Gene, I don’t think that we would share the same attorney. And listing brokers are contractually bound to do everything in best interest of seller. So if you’re a buyer going directly to that listing broker, you don’t have representation. And the fact is, most people want representation. But buyers also aren’t dying to come out of their pocket to pay their agent. That’s why if a buyer works with the right realtor who knows how to handle these things, a lot of times it will get negotiated into the transaction.

Gene Lavanchy: And as a seller, Anthony, it can be business as usual. But you want to make sure if you want people to come and there are people representing buyers, you don’t want to eliminate them from seeing your property. So how do you make sure that that doesn’t happen?

Anthony Lamacchia: Well, that’s good of you to know that, Gene. You’re certainly on top of things. Here’s the fact. The vast majority of homebuyers seek the path of the least amount of financial resistance. So what most buyers do, remember, most buyers, particularly first-time buyers, they’re already stressed out about having to come up with a down payment, having to pay closing costs. Very few of them are going to say, oh, please also show me the houses where I have to come out of pocket to pay my realtor. Very, very few buyers are going to say such a thing, if any at all. So for a seller, when you ask that question, one of the ways that a seller can make that easier and make their home more attractive and market their home to buyers is to have a willingness to negotiate these types of fees, hear out what the buyer’s brokerage is looking for and negotiate that within the transaction. And they land wherever they land with the fee. But if a seller is steadfast against that and says, I’m not paying a nickel, they will likely find that there will be less buyers showing up to buy their home.

Gene Lavanchy: Really short on time here, Anthony, so quickly, is this it for the long haul? Is this thing going to get tweaked again at some point?

Anthony Lamacchia: I wouldn’t be shocked if it got tweaked. You know, there’s a lot of people that have their, they want to put their hand in the jar of real estate. It’s a multi-billion dollar business. The Department of Justice has seemed to have an obsession with the real estate brokerage business. This agreement is supposed to be an eight-year agreement. The judge still hasn’t certified it. It’ll be finalized in November. I wouldn’t be surprised if there’s some tweaks here before the end of the year.

Gene Lavanchy: Well, with rates coming down, it’s going to get active out there again and folks really need to become familiar with how this all works right now.

Learn more about Anthony Lamacchia