Real Estate Kingz Insights

A REALTOR® is a special kind of real estate agent: one who follows NAR’s strict Code of Ethics, including the first and primary pledge to protect and promote the interests of their clients. This obligation means that a REALTOR® cannot make decisions or provide representation in a way that puts their own interests or commissions ahead of their clients’ interests.

What does it mean for a REALTOR® to act in a BUYER’s best interest?

A REALTOR® has an ethical duty to tell a buyer about every home available for sale that meets their criteria. That means that REALTORS® will let you know about all available homes, regardless of whether the seller or listing broker is offering compensation to your buyer’s agent—even if compensation offered by a seller or listing broker is less than what you agreed to pay your agent in your written buyer agreement.

What does it mean for a REALTOR® to act in a SELLER’s best interest?

A REALTOR® should explain to their seller the benefits and costs of the various types of marketing that can be done for a listing, and how potential buyers might respond to such marketing. A REALTOR® is ethically prohibited from telling a seller that their home will be hidden from buyers unless the seller pays a particular type or amount of compensation.

What is wrongful “steering”?

The REALTOR® Code of Ethics prohibits “steering” buyers toward homes because the REALTOR® will be paid more, or away from homes because the REALTOR® will be paid less. Similarly, the REALTOR® Code of Ethics prohibits a REALTOR® from telling a seller that buyers will be “steered” toward homes because the REALTOR® will be paid more, or away from homes because the REALTOR® will be paid less.

How do written agreements protect me from steering?

As of August 17, 2024, you will be asked to sign a written buyer agreement before touring a home with the professional you want to work with. NAR’s ethical rules have long encouraged REALTORS® to enter into written agreements with their clients because these agreements promote clarity and transparency. They also help protect you from wrongful “steering” by specifying the amount of compensation the REALTOR® will receive and the services they will provide. Since a broker working with a buyer receives the amount the buyer has agreed to, the amount of any offer of compensation is irrelevant to the buyer-broker’s compensation.

Where can I learn more about buyer agreements?

NAR has created a dedicated resource on written buyer agreements.

What can I do if I think a REALTOR® is violating NAR’s Code of Ethics?

If a REALTOR® acts in a way that places their interests before yours, this is a violation of NAR’s Code of Ethics and should be reported to your state or local REALTOR® Association for investigation and potential disciplinary action.

Practices may vary based on state and local law. Consult your real estate professional and/or consult an attorney for details about state law where you are purchasing a home. Please visit facts.realtor for more information and resources.

The above article is Copyright NATIONAL ASSOCIATION OF REALTORS®. Reprinted with permission.