August Newsletter

The Lazy, Hazy, Crazy Days of August

 
Between seeing my face splashed on New Jersey and New York billboards and kiosks and the introduction of the new Real Estate regs, this summer feels surreal! Read below for important changes in the industry and how it could effect you.

The New Rules of Real Estate

I am careful how much I email clients. I like providing clients with the most informative and useful information so you can stay real estate savvy. To that end, there has been significant media coverage of the the National Association of Realtors settlement agreement resulting from the Sitzer-Burnett case. An indirect result of that ruling is New Jersey’s Bill S3192/A4454, known as the Real Estate Consumer Protection Enhancement Act 
 effective August 1st. I wanted to clarify what this means for home buyers and sellers since buyers and sellers will likely see brokerages and agents (frantically) adopting and adapting to new policies both locally and nationwide.
 
Background
 
Historically in the Northern NJ Counties (and in much of the US), sellers have paid for both the buyer and listing agent’s commission; the total commission is referred to as a “bundle” and was split between the agents. The seller has discretion over the commission paid to the buyer's agent as well as the listing agent. The amount is ratified in the listing agreement before the home is listed on the market and the commission fees were documented in the MLS. Offering a commission to buyer's agents can serve as a marketing tool to enhance the exposure of the home and attract potential buyers. Therefore, the decision of how much to compensate buyer's agents can be a crucial marketing feature when selling a home. So whats going to change?
 
How the New Law Will Effect Buyers?
 
CHANGE 1: Buyer Representation Agreements
Before touring any properties, all agents are required by the new law to have buyers sign a written agreement. Buyer agency agreements are not new, they have been used for years, but now are required by the State of New Jersey. This document clearly defines the agent’s services and responsibilities to the buyers and the compensation that will be due in exchange for their agent's services.
 
CHANGE 2: Disclosure of Representation at Open Houses
Listing Agents are now required to inform potential buyers who they represent at Open Houses. This ensures there is transparency for buyers and helps them understand how representation works when buying a home.
 
CHANGE 3: Seller's Property Condition Disclosure
While in our local market, this practice was common, it is now required that sellers have to complete and sign a Seller's Property Condition Disclosure form. This provides buyers important information about the property. A signed Seller’s Property Condition Disclosure must be on hand at all open houses.
 
CHANGE 4: Commissions for buyer agent are no longer permitted to be listed in the MLS listing.
However, commissions can still be shared publicly on brokerage websites, marketing materials (including flyers), websites and social media. We are already seeing creative ways of communicating this.
As far as we have seen in Essex County, sellers are still offering buying agent commissions. Sellers may cover the buyer agent commission amount in the form of a seller concession. Should a buyer’s agent commission not be covered by the seller, buyers may also finance buyer agent fees into their mortgage or negitiate those fees with their agent.
 
How the New Law Will Effect Sellers?
 
CHANGE: Buyer's agent compensation is no longer permitted to be published in the MLS. However, commissions can be shared publicly on brokerage marketing materials including flyers, websites, and social media.
 
NO CHANGE: Sellers can decide how much they want to pay a buyer’s agent (if at all) and there is no pre-set amount, there has never been. This has always been negotiable. And as above, the decision of how much to compensate buyer's agents can be a crucial marketing feature when selling a home.

We are already seeing creative ways of commuicating buyer's agent fees.

As these changes go into effect, it remains to be seen how they will impact the industry and home prices, particularly given the historically low supply and high demand in our competitive market. The situation remains very fluid. Compass has been very enagaged in training their agents to adapt to these new laws so we can educate and guide our client. I am sure you will have questions and I am happy to discuss how these changes can affect your real estate plans, do not hesitate to reach out.

My Spring Listings & Sales

I represented several homes this season ranging from luxury homes in prime neighborhoods (Glenwood), the perfect forever family home (Draper) and snatched starter/downsizer homes (St Cloud & Emerson). Real estate isn’t always unicorns and rainbows though. Sometime clients come to me with real estate that, at its best is just a "transaction", or at worst an enigma (Berwyn). Me and my team of professionals are ready to discuss and successfully solve any range of real estate needs.

montclair

22 Glenwood Road

5 BD 3.2 BA Sold: $1,800,000 

Montclair South End

36 Draper Terrace

4 BD 2 BA .22 AC Sold: $1,100,000

Brookdale

23 Emerson Terrace

3 BD 1.5 BA .15 AC Sold: $933,000

St. Cloud

379 St Cloud Avenue

3 BD 1.5 BA .22AC Sold: $750,000

Orange

41 Berwyn Street

5 BD 2.1 BA 2424 SF Sold: $275,000

Local Q2 Market Reports

As we enter the third quarter, we can assess how the real estate market has developed in 2024. In most markets, we have seen a rise in inventory as well as a rise in the average and the median sale price. Montclair, for example, set its highest median price at $1.55M. The over-ask price in Montclair has been relatively consistent at around 24%. The premium cost of Montclair has naturally caused buyers to search neighboring towns thus put pressure on the pricing in surrounding towns and the over-ask price hovers in the mid-high teens. Buyers keep these percentages in mind when making offers.
 
The fall is the second most popular season, hopefully the rise in inventory will continue (I know my stager says she has been booking up). There are rumors of interest rates declining further, a mixed blessing as it could push selling prices higher as borrowing cost decreases.
 
If you are planning to put your house on the market in the spring, now is the perfect time to meet with me to discuss home sales prep. We see demand continuing in most markets. The one market that is lagging is in the super-luxury market ($2.5M+). These are special homes with luxury features, generous acreage, premium pricing and high taxes. It’s a specific buyer for this market. They want "the house", in the "best" neighborhood; and even more importantly, they want privacy. When I first started as an agent, I was told by one of our town's most experienced luxury agents that these buyers don't trade real estate in election years. I've had my reservations about this theory, but this year, at least in the Montclair market, it seems to align with her advice.
 
I am happy to chat about any questions you have about the market. With the new rules and lower interest rates, it’s going to be a wild ride this fall!

Q2 Essex County Market Reports

Local Happenings

Mark Your Calendar! Sept 7 

Only opened to the public for 4 days a year, this garden is called one of the most important private gardens in Nutley, New Jersey, Mountsier Estate  
unfolds across two acres and includes over eighty pieces of figurative and abstract sculptures.  Silas Mountsier started the garden in 1954 and began working with Richard Hartlage in 1991 to redesign and expand the garden.  Today this study in greens is the perfect foil for the art. Four terraces provide spaces to relax and enjoy the views. A viewing platform offers a vantage point for surveying the garden. . 

Lifestyle 

J'TAIME NEW JERSEY
The Centre Pompidou Bets on Jersey City

The Pompidou is coming to Jersey 

. Over the past decade the museum has opened satellites in Málaga, Brussels, and Shanghai, and once the flagship closes in 2025 for a comprehensive five-year, $290 million renovation, these outposts will be critical for displaying its sprawling treasure trove of 100,000 works. (No official reopening date has been announced.) The Centre Pompidou x Jersey City is expected to open in 2026 in a 58,000-square-foot building constructed in 1912 as part of a trolley station. It will be redesigned by the New York office of OMA, the firm founded by Rem Koolhaas.

Courtesy of Town & Country 

Common Seller and Buyer Mistakes

Buying and selling real estate is littered with costly obstacles, but you can steer clear of many of them.

Courtesy of U.S. News 

Houzz Emerging Summer Design Trends Reports Reveals What's Hot

Houzz has released its Emerging Summer Design Trends Report, which includes organic modern style, reading rooms, Japanese influence, and more!

Courtesy of Forbes 

Thanks for reading and subscribing! Ready to achieve your next real estate goal?

Reach out to chat!

Meredith Bergmann
 
Lic. Sales Assoc.
Principal Agent
M: 917.355.4074
O: 973.310.7360
[email protected]

Office: 973-310-7360

Compass RE is a licensed real estate broker. All material is intended for informational purposes only and is compiled from sources deemed reliable but is subject to errors, omissions, changes in price, condition, sale, or withdrawal without notice. No statement is made as to the accuracy of any description or measurements (including square footage). This is not intended to solicit property already listed. No financial or legal advice provided. Equal Housing Opportunity. Photos may be virtually staged or digitally enhanced and may not reflect actual property conditions.

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