New real estate rules impact South Dakota homebuyers

RAPID CITY, S.D. (KOTA) – A 2023 legal decision is changing how realtors nationwide do business, causing lots of confusion for potential home buyers.

The National Association of Realtors has made some new rules affecting how real estate agents get compensated.

Under the new rules, when a home is sold, the seller doesn’t automatically pay both the listing agent and the buyer’s agent. Instead, the seller can choose how much to pay the buyer’s agents or whether to pay them at all.

Stacey Nelson, a South Dakota Realtor, says this price has always been negotiable.

“One of the confusions about real estate is that the set fee is set, and that’s not true. In South Dakota, our fees have always been negotiable; we establish those professional fees with the buyer’s agents and the listing agent at the time of listing with the client,” Nelson said.

These national changes, which went into effect Saturday, August 17, are meant to make the process clearer for the buyer, the agent and the seller.

But the only significant change in South Dakota is that now, buyers must sign an agreement before they can even begin touring homes with their agent.

“Now when we work with consumers, not actually clients but just somebody coming to look at a house, they will be required to sign a buyers-agency agreement,” Nelson said.

The buyers-agency agreement will detail exactly how much a buyer will be expected to pay their agent.

“For the last 20-some years, we have had explicit buyer-agency agreements with our buyers, and in our listing agreements we’ve disclosed what the buyer’s professional fee is and what the seller’s agent professional fee is,” Nelson explained.

Nelson says the changes won’t impact South Dakota, since realtors in the Mount Rushmore state already did most of the new rules.

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