For years, Indiana home sellers have signed formal listing agreements with real estate brokers but now buyers also need written agreements before purchasing a home.
The change is among 172 new laws approved this year by the Indiana General Assembly which kicked in this month. The change stems from a major settlement between home sellers and the National Association of Realtors, aiming to boost transparency and consumer protection.
Maggie McShane, senior vice president of government affairs for the Indiana Association of Realtors, said professional representation is crucial for homebuyers navigating a complex and challenging market.
"Many states already require this," McShane pointed out. "We don't run into opposition from consumers in those states. The change in practice might take some consumers by surprise but they're being represented contractually as well."
Previously, home sellers typically covered both listing and buyer agent commissions. Now, buyers might need to pay their agent's commission if the seller opts out. It is important to note buyers can still visit open houses without an agent.
McShane noted the new state law clarifies the relationship between buyers and real estate brokers, detailing terms and compensation.
"If down the road we foresee if there is a separation between those two sides of the transaction that this would treat both sides equally," McShane emphasized. "Consumers have a written agreement and the agent has a written agreement with their client on how that should proceed."
Experts reminded Hoosiers the impact of the change will unfold as the market adapts, and to remember everything in real estate is negotiable.
