 What's up everybody? Ricky Caruth here. Welcome back to my channel. So today's topic is the DOG, the Department of Justice, is suing they have been. This is an ongoing case. The National Association of Realtors and I really want to get your two cents on this because this is something that's really going to shake up the industry. So let me get into the details of this lawsuit, what it's all about and then I'm going to get into my two cents on it and I'm going to tell you other agents reactions to it and I want to hear what you think about in the comments. Oh yeah, before I forget, December 11th, I'm going to release my brand new 90-day action plan for real estate agents during my 2021 goal setting and business planning session. Okay, the link is below to register for that event or you can text me 251-312-8844 and I'll send you a link to register. Okay, so let me read you a little bit of this. The Department of Justice sues NAR, they allege that there's illegal restraints on realtor competition. Okay, so basically they're looking at the situation and the biggest issue here is disclosure to buyers what the buyer's broker commission is. Okay, they want that to be disclosed publicly. The U.S. Department of Justice has filed an anti-trust lawsuit against the National Association of Realtors alleging that 1.4 million member trade groups rules are illegal restraints on realtor competition. The federal agency filed a settlement at the same time as it filed the suit requiring NAR to repeal or change several rules the Department of Justice deems anti-competitive. Okay, these rules include prohibiting MLSs that are affiliated with NAR from disclosing to prospective buyers the commission that the buyer broker will earn if the buyer purchase a home listed on a multi-listing service. Okay, here's another one. Listen to this, allowing buyer brokers to misrepresent to buyers that a buyer's broker services are free. And check this one out. Enabling buyer brokers to filter MLS listings based on the level of the buyer's broker commissions offered and to exclude homes with lower commissions from consideration by potential home buyers. The complaint says that these NAR rules, policies and practices have been widely adopted and enforced by NAR affiliated MLSs and are therefore agreements among competing real estate brokers each of which reduce price competition among brokers and lead to lower quality service for American home buyers and sellers. So in a nutshell, what they're saying is they want to disclose that buyer broker commission to the buyers, they want buyers when they search, they know exactly what that real estate agent who is representing them is going to get paid. Right now they have no idea because it's not disclosed anywhere and that's the way it's been forever. Okay, also what I find interesting is the side of telling buyers that that they're not paying the commission. Okay, because we have this perception, okay, over the years because of how we've done it standardly so far that the seller is paying the full commission. Okay, and when you look at it from the real estate agent's point of view, you think, yeah, the seller is paying the commission, but however, if you put yourself in the shoes of the buyer, you look at the situation and you say, okay, he's telling me, the real estate agent is telling me that they're working for me for free, that the seller pays the commission. However, they're making thousands and thousands of dollars by representing me and on the HUD statement it shows two commissions, one for the listing agent, one for the sale agent. So if you take a step back and you look at this from both angles, you look at it from the real estate angle, and you think, I don't know if I want the buyer, I don't know if I want to change this, I don't know if I want to shake this up. Right, they don't know the seller is paying it, it's negotiated when we do the listing agreement with the seller, right, we're getting paid from that end of it. Okay, however, if you're on the buyer side of it, if you're the consumer, if you're the customer and you're buying a house and you have no idea really what your agent is making, right, and that whatever they are making gets figured into the price. So therefore, there is some legitimacy here to what they're saying. Please let me know in the comments what you think about this. Okay, your perspective of it because I'd love to hear it. I like to look at it from both angles. Now I've been saying it for years, years I've been saying that I feel like that eventually we're going to get to a 4% standard commission. Okay, I didn't think I had no idea that, and this may not do it, but I had no idea that it would potentially happen through a lawsuit from the Department of Justice to NAR, had no idea that that's the route it was going to go. I was thinking more of technology and access to information for buyers and sellers and the ease of transactions and how easy technology can make a transaction, right, and I feel like there's a lot of competition and things were going to happen at some point that was going to put pressure on our commission, whereas I still feel like 4% 2 and 2 for each side of it is still an extremely lucrative situation for real estate agents and new agents coming into the business at that point that find a 4% 2 for each side situation. They didn't know what a 3 and 3 or a 2 and a half, 2 and a half even felt like. They're entering into the industry at that point, so I just feel like at some point, right, and this may not be it, but I still feel like at some point whether it's this situation or a technology or a company, something's going to happen that's going to put pressure on our commission. It's inevitable. I believe it's going to happen at some point. However, the upside of it and the positive outlook and perspective is, is that still going to be extremely lucrative. Now tell me if you agree with this, right, this was written by Inman, a new lawsuit accusing the National Association of Relatives of anti-competitive practices could drive down commissions, push agents out of the business and have a number of other disruptive practices on the real estate industry. I don't know if I agree with all of that, maybe to a certain extent, but according to everything that I'm reading, NAR is going to comply with some of these roles, including disclosing the buyer brokerage commission, right, in the first quarter of 2021. So these things are going to come into effect. Here's a few reactions from a couple of agents, okay, this agent's out in Phoenix. She says that a possible outcome could be that the buyers start to have to pay for their own agents. Many buyers may not be able to afford that additional cost, okay, meaning the quality of service for buyers may actually go down. She says she thinks it could harm buyers in a sense and probably take away a lot of buyer agency. Service has to be paid for. Another real estate consultant, Ken Ginney, he's the owner of real estate consulting company, Transcend. Okay, he envisions that the case impacting commissions, although he said the upside could be a better consumer experience. This isn't a downward pressure on commissions, he said. It's an upward pressure on value. I like that. He said if you're a buyer broker and you really want to be valuable, you should be in there negotiating your fee with the buyer. A lack of transparency has made such negotiations difficult so far, though the industry is moving in the direction of greater choices for consumers. And this isn't interesting. This is Tyler Ford, the CEO of Nashville Base, low commission brokerage, Felix Holmes. Okay, he was upbeat about the case telling Inman that in an email that we're extremely passionate about lowering real estate commissions for buyers and sellers. Of course he is. He's a low commission brokerage. Okay, he's a discount brokerage basically. He says anti-competitive price fixing has gone on for too long in the realtor community. And as a fellow realtor, we should be ashamed. Do you guys feel ashamed of the way that we've been operating as far as negotiating that commission with the seller and letting the seller pay you out of the purchase price of what was negotiated from the beginning before we were ever even under contract? He goes on to say either make buyer agent commissions available to the public or completely hide them from MLS and all the other agents completely. That way the buyer brokers can't filter their buyers to a certain home because of a higher commission rate. Another Keller Williams agent out in Arizona acknowledges that the case could create downward pressure on commissions, but that said at the end of the day, it's just going to evolve. Guys, we are going to evolve. This could shake things up a bit, but it's going to be, it's great. Shake ups are good. There's opportunity within shake ups always, every single time. And this is a good point. He said, we're a consumer driven market. If the cost of soda goes down, is Pepsi going to make a worse product? I don't see that happening. I see them making a smarter product. Guys, this may actually create a scenario that is better for consumers and agents. It may create a scenario where the consumer has a better experience. They feel like they're in the know. They know upfront what's happening and how everything works. And on the backside, we are going to be in a position as real estate agents to provide better value and really go above and beyond. And what is that going to do? That's going to create better relationships with our customers and clients. And we're going to receive more repeat business referrals and referrals of referrals. The same Keller Williams agent said, this for the most part doesn't bother me. I don't think it's going to be anything that is industry breaking type situation. And I 100% agree with that. This is not going to be industry breaking. Okay, we're going to adapt and we're going to move forward. That's what we do. Okay, guys, I'm going to keep my eyes on the story and bring you updates as they come out. Please hit subscribe and hit the bell if you haven't already. Let me know what in the world I can do for you. And we'll talk to you guys on the next video. Let's go.