The Real Estate Chaos of 2024: What You Need to Know NOW!
In this August 2024 video, real‑estate professional Leigh Thomas Brown outlines a perfect storm of upheaval affecting REALTORS® across the United States. He first describes how almost every state is revisiting its real‑estate statutes and agency‑relationship rules, creating a patchwork of divergent regulations. He then explains how those statutory changes cascade into a maze of differing standardized contract forms—some state‑issued, some brand‑specific—raising ethical and legal risks for agents who attempt to interpret unfamiliar paperwork. Brown highlights the influence of the Consumer Federation of America (CFA), a Washington‑based NGO that is publicly critiquing certain forms and advocating commission caps, which he argues is beyond its purview. The video moves to the Multiple Listing Service (MLS) arena, where MLS operators are removing the buyer‑broker compensation field in response to class‑action litigation, fundamentally altering how commissions are disclosed and negotiated. Brown condemns a growing narrative that REALTORS® should work for free or that their commissions are a housing‑affordability problem, linking this rhetoric to political attempts at price controls dating back to 2006 and citing bipartisan efforts to limit or eliminate commissions. He questions who benefits from these moves, suggesting hidden financial motives. Throughout, Brown urges his fellow agents to stay angry, stay informed, engage with their trade associations, and spread the message, noting that only 25‑27 % of the public is even aware of these changes. He calls for collective action to protect the profession and the American Dream.
Chapters
I need to ramble for a second about real estate. And as I was trying to get my thoughts together, I realized there's no way to make this make sense right now. Because as I record this video, it is August of 2024. And everything in organized real estate is currently changing on the fly. And when I say everything, let's start with state legislative action and regulations. Almost every state in the country is having a new look at their general statutes as relates to real estate, and in particular, how it relates agency relationships, which is what the real estate agents' or licensees' relationship is to the member of the consumer public. That's different state by state. North Carolina, we have very excellent legislative general statutes as relates to real estate, and still our commission is taking a look at things, trying to decide what's best for the public. So you have 50 states and then you have the territories. Everybody's doing things differently. That's chaos piece number one. And chaos piece number two 2 has to do with the implementation of those general statutes and those regulatory bodies regarding paperwork, regarding contracts, regarding any standardized forms, which are designed, by the way, not for any kind of collusion purposes, but because real estate licensees are not lawyers and cannot draw up legal forms. Therefore, many of our bodies, our associations, our trade organizations have created standardized forms with the help and guidance of our legal counsel, and here in North Carolina with the Bar Association, to make sure that what we have is approved and understandable so that a licensee can present that to a member of the public and have it be understandable. Now, the forms in one state are different than the forms in another state because they have different general statutes, and because we live in a constitutional republic, everything is different. Introduce another layer on top of that, which is that some firms, some brands, have their own forms And so now you have different forms for different situations for different consumers, which means that if you are a practicing REALTOR®, make sure that you note, if you get paperwork that you're not familiar with, you don't get to interpret it. That's a violation of the code of ethics. And in all likelihood, it's also a violation of license law. So now lawyers have to come in and help interpret the different kinds of paperwork that are going on. That is a big wrinkle that's happening. And let's add a wrinkle on top of a wrinkle. With that one, we're also being told by an NGO, a non-government organization that operates in DC that has had a laser beam focus on real estate for over 40 years, that being the CFA, the Consumer Federation of America, now weighing in saying some forms are okay and some forms are not. No, no. Okay, I'm just going to pause here for a second because I do know what I know. And that is that an NGO does not have any business saying which forms are valid and which forms are not. They are simply trying to pursue their own viewpoint. Now, I'll go back to the next piece of chaos. The next piece of chaos, in addition to state laws and regulations and contract changes, is the way that we communicate information to each other as real estate professionals and to the public through syndication and through our open sources of data known as the Multiple Listing Service. Multiple Listing Services throughout the country are changing their rules and adapting what's visible not visible and offered from July, frankly, until August 17th. And all of these things are changing, which seems okay for those of us that pay attention and are very baked in with real estate because we use it every single day to service buyers and sellers. And for many of us, we are very baked into the trenches when it comes to policy work. And we really want to know what's happening with our profession, which means so much to us, because this is my livelihood. It is also my investments. It's also my community. And it's every single neighbor's American dream. So yes, I pay attention every single day, probably too much. But many, many, many REALTORS®, many licensees, they don't know that any of this is going on. In fact, if they stumbled on my video because you shared it, good job, friend. They're a little slack-jawed right now. And in fact, every Multiple Listing Service in the country is currently getting calls to their consumer— well, not consumer really, but to the member hotline saying, where did the compensation field go? Simply because for whatever reason, they're not dialed in to what's been happening happening and changing. And as you may or may not know, one of the things that is changing is that in real estate, if you're selling a home, you can no longer offer compensation to a buyer's broker through the Multiple Listing Service. Now, this goes deep as to what has been our tradition of operation, why it's changing— it has to do with the class action lawsuits— and what the outcomes are going to look like. But outcome number one is that the Multiple Listing Services have removed that field. So if you are logging in for the time in months, you're going to discover that it looks different. And for the record, if that's you, please call your association immediately and talk to the education people and get some of the webinars, get the information and get yourself up to speed because I believe in you, friend, you can read and get caught up. Maybe life got in the way. But what the consumer doesn't know is why this is going on. And what I have found is that many REALTORS® have a hard time explaining why this change is happening simply because our system has operated so efficiently for so many years. Now, Now, any lawyer can tell me what they think is going on, but I would dispute that because lawyers seek lawyer fees and would just as soon remove all REALTORS® from the world, I think, because that's just how it has looked. Not all lawyers. I know there's a couple of good ones. I can see y'all wanting to comment right now. Hey, Jamie Kosofsky, I know you're going to comment. But you know, there's a vast difference in the real estate attorneys who believe in real estate professionals and the ones who are class action lawyers who just want to make bank off of problems that they can create. So that's going on. Going on. All right, now let's talk about the other thing that's adding to the chaos that I don't think many agents are paying attention to. Now, because you're watching this video, you're dialed in. I need you to start getting angry, because there's a real problem right now with the narrative around real estate. It is unfair. It is frankly un-American. It is against the idea of a free market. And that is this very direct attack on REALTORS®. I see it in the comment threads when so many people tell us we should work for free. Why? Somebody tell me why. Why should I work for free? Why should I bust my tail to become a market expert? Why should I put myself at liability risk? Why should I work the hours that I work and stay out of my house and drive all over God's country going into other people's houses, putting my safety at risk? Why would I do all of these things for nothing? I do not understand this conversation. I do not find that any other profession on the planet has been told that they should work for including somebody that I really respect, an opinion maker in real estate, who thinks the pro bono model makes sense. I don't understand this. Sure, you can say some lawyers decide to do some pro bono work, but most of them are in partnerships and in firms where they have a guaranteed level of income. It doesn't exist in real estate. In real estate, that professional that you love, the one from your Bible study group or from the ball field or the one that you drank a beer with last night, that person is a 1099. That means that they woke up today unemployed and they they will go to bed unemployed, and they are working their tail off in between with the American dream of making a living at this. Why in the world is there so much talk about REALTORS® not being paid? There are 1.5 million REALTORS® and another probably 2 million licensees out there. Why is it that our profession has no right to be compensated? Answer me that without emotion, with some facts. Show me why we don't deserve to be paid for our professional time and expertise. Well, the next thing you'll find out is that there is a grand push to say that REALTORS® are paid too much. I will tell you this, I as a consumer will always pay a premium for a professional that I feel delivers a top level of service that brings their expertise in. And I don't want to pay that same number for somebody who is less experienced, less knowledgeable, and less caring. That is what has existed in real estate, by the way, for a long time. You as a consumer get to interview agents, you've always been able to say yes or no, and you've known that the compensation would occur at the satisfaction of the transaction unless you had a deal where you were paying them all along, you were paying hourly, however you set it up. There have been as many business models in real estate as there are REALTORS®. Do not believe those headlines that tell you we've all operated the same way because that is a lie. Now you got to ask yourself this, so self, why is it that this latest press release from that same NGO, the Consumer Federation of America, why does it say that consumers consumers should pay a max of a certain percentage? And why does it say that consumers shouldn't even pay a percentage, they should pay a flat dollar amount? Why are they telling you what you should and shouldn't pay? I believe that what you should and shouldn't pay is probably going to be different market by market. It's going to be different expertise by expertise. And frankly, for you as a consumer, what you need from the agent might be different based on what kind of property it is. If you're an experienced investor, you probably have a different setup than the consumer who's selling a house that needs a lot of handholding, that they haven't sold a house in 40 years. Those are two different fees altogether, because the time involved is different, and so is the level of expertise. So why are we being told by the CFA, that Consumer Federation of America, what the consumer should and shouldn't pay us? You know what that looks a lot like to me, friends? And you'll have to go back to the Nixon presidency to see a real example of this happen in broad daylight. That's called price controls. Price controls are when the government says there's a max on what you can charge. Now tell me this, Why does the government get to meddle in real estate and say there's a max on what we can charge? Well, what they'll tell you, and they've said it even in public remarks back in March when President Biden spoke in Nevada, and when his press secretary, Karine Jean-Pierre, spoke the following day, both of them stated that real estate commissions were making housing less affordable. That's not true. It's just not true, y'all. If you take real estate commissions out of the equation, it's not going to change the cost of housing. What it does, though, is make it harder for the buyer and seller to consummate a deal because it is the REALTOR® in almost every scenario who helps manage the details to hold it together. Now, I'll grant you there are some that aren't as good as others, and if they need to get better, they need to get better. But I will not throw the baby out with the bathwater. And that's what's being done by these government agencies that want to issue price controls. Now ask yourself this: what other profession is being told what they can and can't charge? Why is it just real estate? Well, I've got a lot of theories on this. I'm doing some research on this. But the biggest thing I can tell you is that if you're angry at your trade association, your anger is misdirected. Right now, your trade associations are trying to please proposed settlements and angry government bodies for issues that go back a long ways. Your current leadership may or may not be the absolute best leaders ever. I'm not even talking about that. That's an agnostic thing. But they shouldn't receive your ire right now. I want you to pay attention. Go back to 2006, when You had Representative Michael Oxley, God rest his soul, Republican from Ohio, who was the chair of House Financial Services. And he wanted to get rid of real estate commissions. This is not a partisan thing. This is on both sides of the aisle. You have had elected officials trying to get REALTORS® out of the transaction. Ask yourself why. Start asking yourself, who funds who? Where does the money go? And why exactly is it that they want to get rid of REALTORS®? One of the best REALTORS® I've ever known texted me this morning. She's really good, y'all. This woman works her tail off for her clients. In fact, I don't think she sleeps some nights because she wants to make sure that they're okay. And she said, "Maybe I should just sell eggs, go sell plants at Lowe's, and give up on real estate." And I said to her, I said, "That is exactly what these agencies want. They want you, the good REALTOR®, to give up. Because if you're not involved, there's a whole lot of your neighbors out there that won't have anybody they trust, that won't have somebody that can help them figure out the mortgage, process and understand what's happening in the markets and what kind of an offer should we make and how do all these pieces work, if not for you. So I urged her to stay the course. Friends, if you're in real estate right now, I want you to stay mad and I want you to stay connected. I want you to read beyond the headlines and start asking better questions. And I want you to bring another person into this conversation. I want you to share this video with a client, a past client, another real estate person, somebody who is or is not involved in this space. Because one of the things that's causing more chaos, and I should probably finish tying a bow on that, but I told y'all I was going to ramble, fair disclosure. It's estimated, and the only estimate I've heard on this comes from James Dwiggin, the CEO of NextHome, and he's one of the smartest people in real estate. The estimate he had is that 25% to 27% of the public even knows anything's going on. In fact, you may have stumbled into my video and you just started listening to the Southern accent and have no idea what's going on. And that adds a chaos because as REALTORS® are trying to process changes for a proposed settlement where there are third parties getting involved telling us what we can and can't do and what we can and can't charge, then you bring in an uneducated consumer who really just wants to sell mama's house, or who wants to go buy their first home. Now you've got frustration and panic mixed in with a lack of knowledge. We're going to be lucky to hold the American dream together. But I don't think it's luck. I think it's skill. And I most importantly think it is a desire not to go anywhere until everything has settled out. So make sure you click the bell, leave me a comment below. I'm going to keep exposing this. I'm doing some research because those that are driving this attack on real estate need to answer for it, because something tells me they've already got their piece of the American dream. But you and I, we can't rest until our other neighbors have had a chance to.
