How buyers' agents can prove their value and boost commissions in 2025

In this episode of It's Closing Time, host Michael Lucarelli, CEO of RentSpree, sits down with Brian Donnellan, CEO of Bright MLS, to explore the transformative shifts shaping the real estate industry. From the growing role of tech companies and the impact of the pandemic to the evolving buyer's market, Brian shares insights on how individual players are resisting while the larger industry is slowly adapting. They dive into the challenges of merging MLSs, the importance of transparency, and initiatives like Redistribute and Nestfully aimed at empowering brokers and agents. Brian provides a bullish outlook for buyers’ agents in the coming year.

Donnellan highlights three major changes in the real estate industry over the past year:

1. End of Isolation in the Industry: The industry, once shielded by a "protective layer," is now more open to outsiders like tech companies. While this brings opportunities, there are also potential downsides.
2. Impact of the Pandemic: COVID-19 brought lasting changes, particularly with remote work, which affected consumers, brokers, and agents. It also influenced the industry's legal landscape and technology adoption.

While the industry as a whole is experiencing a number of changes all at once, Donnellan shares the specific challenges he sees independent contractors having to navigate over the past year.

1. Resistance to Change: Many of the industry's 100,000 independent contractors share a common trait—they dislike change, as it disrupts their routine and forces them to relearn processes.
2. Communication Challenges: Realtors are often on the move and prefer concise, relevant information, making it difficult to convey new updates effectively.‍
3. Recent Changes: The speaker notes that recent changes aimed at providing more transparency in transactions will take time to evaluate. While some positive and negative outcomes are expected, it’s still too early to assess the overall impact.

Donnellan reflects on the complexity of forming Bright by merging nine smaller MLSs, highlighting several key points:

1. Challenges and Politics: Change is difficult due to the political dynamics within the industry, where some people lose control over long-held processes. The industry isn't inherently set up to easily embrace improvements.
2. Difficult Process: The speaker acknowledges that while they are glad the changes were made, the process was harder than expected. In hindsight, they might have phased the implementation, though it would have taken longer.
3. Outcome and Improvement: Despite the challenges and emotional toll, the outcome is seen as positive, with the industry being in a better position now than before. Coordinating data across nine MLSs was particularly challenging, but the regions ultimately benefited from the changes.
4. Lack of Control: The speaker emphasizes that people tend to accept change more easily when they can control its pace. However, the current changes in the industry are beyond anyone's control, including their own. While people are now more accustomed to change, they initially resisted, even over minor issues like terminology (e.g., calling a property a ranch or a rambler). 

Donnellan discusses the collaboration between CRMLS and Bright MLS, focusing on three critical initiatives:

1. Redistribute Initiative: This project aims to return the value of real estate data back to brokers, with over 50% of U.S. listings now included. The goal is not for Bright or CRMLS to dominate the industry but to benefit brokers and agents.
2. Nestfully: Often misunderstood as a portal, Nestfully is actually a tool for brokers and agents to connect with consumers while keeping the platform free of external fees. It protects brokers and agents from potential future costs.‍
3. Upcoming Developments: The first version of an app will be released in beta in September, with a full launch in December. This app is designed to support brokers and agents. The speaker stresses that while other data-sharing projects are in progress, Redistribute and Nestfully are the most impactful.

Looking ahead to 2025, Donnellan shares his prediction that buyers' agents will have an opportunity to increase their commissions rather than experience a decline. But just how much an agent earns is largely contingent upon their ability to demonstrate the true value they bring to clients and how they choose to price their services. And while there are always changes in the market that even the most savvy of experts can't predict, there are a number of ways MLS executives can prepare their organization for what's to come. Specifically, Donnellan's advice for MLS executives who are planning for the future are:

1. Don't rely solely on cooperation and compensation.
2. Develop a strong long-term strategy for scenarios like financial downturns, agent departures, or rule changes.
3. Focus on improving the transaction process for brokers, agents, and consumers.

As MLSs increasingly grow their tech stack and offer more capabilities to their members, Donnellan emphasizes the importance of vetting and choosing tech partners who share the same vision as your organization. In addition to aligning with your mission, prospective tech partners should also be able to stand up their services quickly and efficiently, and provide transparency to ensure a harmonious, working relationship. Specifically, Donnellan encourages executives to look for partners that share a common vision, can effectively execute the tasks you're looking to perform, and can maintain open communication with your team—especially when things don't go as planned.

And finally, Donnellan shares why he believes the rental sector will play an important role in the evolving real estate market, as well as the impact of the rental market on future buyers.

1. The rental market serves as a "feeder" for future buyers, and agents should not overlook renters as potential clients.
2. The rental market remains strong and is likely to continue thriving, even with potential government intervention, which could introduce new challenges.
3. There is a need to better serve the rental market, aiming for it to be as organized and robust as the home sales market.
4. This belief drives Bright’s efforts to improve rental services through strategic partnerships.

To listen to the full episode, click one of the links below:

Spotify: https://spoti.fi/4e5kCki

Apple podcasts: https://apple.co/4d45kep