Earl Ruthman of CENTURY 21 Circle calls them the Karens of real estate. They’re the agents who made the most noise leading up to the recent compensation and contract changes in the real estate industry, the squeaky wheels who insisted the sky was falling.

They spoke out at industry events, on social media posts and in articles from national publications. The new rules set by the National Association of REALTORS® (NAR) after its legal settlement in the spring prompted cries that the changes would ruin the industry as we know it.

“I call them the Karens of real estate,” said Ruthman, who is designated managing broker for offices in Lincolnwood and Morton Grove. “They’re worried about all this stuff. I really haven’t seen any change.”

Roughly 50 days since the new rules took effect on Aug. 17, dozens of agents and managing brokers have shared that same business-as-usual sentiment with Chicago Agent. New paperwork and a few more client conversations on the front end? Yes. But a whole new way of doing business? No.

“My top agents haven’t missed a beat,” Ruthman said. “They were prepared for this.”

Mostly logistics

The biggest changes implemented by NAR include banning commissions from the MLS and requiring signed buyer’s broker agreements before any showings.

Some brokerages and agents have used signed buyer’s agent agreements for months or years, but those contracts were never required. Others used them sometimes or not at all.

The agents who spoke with Chicago Agent said in virtually every case, the buyer’s broker compensation has been folded into the transaction, just the way it usually was done in the past.

“I haven’t gotten blowback from any new or existing clients about these agreements because it’s worked out where the sellers have just rolled it into their price,” said Cari Zweig-Driscoll, broker with Wexler Gault Group in Highland Park and @properties Christie’s International Real Estate. “I haven’t seen any negativity. The only negativity is not understanding how to use this.”

Zweig-Driscoll said conversations and transparency in the wake of the new rules are happening with sellers, not just buyers. Experienced agents, she said, know that during a listing appointment they need to prep the seller that buyers likely will ask for buyer’s agent compensation, so it’s important to factor that into their listing price.

She likened the changes to more of a logistical change in the transaction than any real shift in how agents conduct business.

“The change is really not a change,” she said. “It’s just a change in the way the accounting’s done. Those who stumble and can’t show their worth will not get the business.”

Increased compensation

Cory Tanzer, broker and owner of Option Realty Group, was braced for a flood of emails, texts and calls. With the new NAR rules in place, he worried that before each showing at his listings, he would get a message from the buyer’s agent asking about compensation. And with 10 showings a week at each of 10 different listings, for example, he feared he might spend hours responding to dozens of messages each week.

That didn’t happen, though. So far, no one is asking about compensation before a showing, and most of those discussions are handled on the back end, once an offer is made, he said.

Not only that, but Tanzer and his agents at Option Realty Group have seen an increase of about 0.25% on their commissions since the new rules started. Buyer’s broker agreements have forced agents to show their value up front, and so far buyers have been receptive, Tanzer said. Some clients have even expressed surprise that their agent’s compensation isn’t higher.

“It’s been a really positive experience,” Tanzer said. “Since we started doing this, our compensation is slightly higher than what we were getting before. We’re actually seeing about 0.25%, roughly, higher than previously. We’ve been negotiating and showing our value.”

That meeting with buyer clients at the outset of the homebuying process is key, Tanzer said. Those discussions help clients understand their agent’s role, the value the agent will provide and how compensation works.

“We have not had a single person say, ‘No, I’m not signing [the buyer’s broker agreement].’ We’ve had nobody challenge us on our value,” he said.

“It’s made us much better at explaining our value to potential customers or clients than we were before.”

Winners and losers

Whether it’s old rules or new, some truisms in real estate don’t change, said Andrea Geller of Berkshire Hathaway HomeServices Chicago. Professionalism, education and preparation are paramount for agents.

“The ones who are the utmost professionals are still the utmost professionals. It’s making those agents stand out more,” Geller said.

“The agents who don’t go to education classes, don’t read emails, don’t pay attention to what the local, state and national boards are putting out regarding license law and code of ethics, who didn’t pay attention to what their companies were directing them to do prior to Aug. 17, are the same agents who don’t know what to do now.”

Geller said the line between experienced, ethical agents and those who may cut corners is clearer under the new NAR rules. Part of that, she said, is just focusing on doing right by the client versus focusing on compensation and commission percentages.

“When people put their commissions ahead of their fiduciary duty, that’s a problem,” she said. “And the people who are putting their commission ahead of their fiduciary duty are the same people who don’t educate themselves properly and know how to work through the buyer-broker agreement and explain compensation.”

Ruthman agreed and said everything will fall into place for the agents who prioritize helping clients buy and sell homes, just as they always have.

“The industry veterans are just like, ‘OK, it’s a change. It’s a law. I have to adapt to the law. I’m not going to let it affect my business,’” Ruthman said. “And they’re still out there listing and selling real estate.”