New: 🧠 Market Minds Issue #035

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The State of the Splits

In the ever-evolving landscape of real estate, the topic of commission splits remains a significant point of discussion among agents and brokers. According to a recent survey conducted by Inman Intel Index, the majority of real estate professionals do not anticipate changes in their commission splits in the near future.

The Inman Intel Index survey, conducted in late May, gathered responses from a wide range of agents and brokers. The findings revealed:

• Stability Expected: Approximately 80% of participants believe that their commission splits will not change over the next 12 months.

• Fear of Decrease: Among those who anticipate a change, the majority are concerned about a possible decrease in their commission split, outnumbering optimists by nearly 5-to-1.

While the majority of brokerage leaders and agents seem to agree on maintaining current splits, the undercurrents of change are palpable. Brokerage leaders must tread carefully, balancing the need to protect margins with the imperative to retain top talent.

Focus On TIME IN The Market, Not Timing It

Some great notes to give those buyers that are on the fence:

The Pitfalls of Market Timing

Attempting to time the market is generally not advisable. For instance, despite predictions that mortgage rates would decrease, they have remained high due to unforeseen market and economic shifts. As reported by U.S. News, those who delayed purchasing in hopes of lower rates have found themselves priced out, as affordability has not improved. This scenario underscores the risks associated with waiting for the "perfect" market conditions.

The Advantages of Buying Now

Equity Growth Potential

One of the most compelling reasons to buy a home sooner rather than later is the potential for equity growth. According to the Home Price Expectations Survey by Fannie Mae, which gathers insights from over a hundred economists and real estate experts, home prices are projected to continue rising through at least 2028.

For example, if you were to buy a $400,000 home at the beginning of this year, projections from the Home Price Expectations Survey indicate you could see an increase in home value by more than $83,000 over the next five years. This kind of growth not only builds your financial portfolio but also secures a substantial asset for your future.

Long-Term Market Presence

The longer you are in the market, the more you stand to gain. Homeownership is not just about the immediate financial benefits but also about the long-term gains from being a part of the housing market. This includes not only equity growth but also the stability and security that come with owning a property.

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A Stargazer’s Dream

This Evergreen, CO home seems like a bargain for $1.595M.

Can someone in Colorado check the Seller’s Disclosure to see if the telescope stays?? 😂

TL;DR (Too Long; Didn’t Read)

In the real estate industry, commission splits remain a hot topic, with a recent Inman Intel Index survey revealing that about 80% of agents and brokers do not expect changes in their commission splits over the next year. Additionally, for buyers hesitant about market timing, it is advised to focus on long-term benefits like equity growth and market presence, as home prices are projected to rise steadily through 2028. The Offer Pilot program also presents an opportunity for agents to earn more on challenging listings.

Have a great weekend - we’ll see you next Saturday.

Cheers 🍻

-Market Minds Team