The recent changes in NAR policies, particularly the removal of mandatory compensation offers on MLS listings and the requirement for written agreements, can disproportionately impact lower-income buyers in several ways:

1. Increased Transaction Costs:

• Negotiation Skills: Lower-income buyers may lack the negotiation skills or experience necessary to effectively navigate the new compensation structures. Without the transparency of predefined compensation offers, they might end up paying more in broker fees, adding to the overall cost of purchasing a home​ (RealEstateNews.com)​.
• Hidden Costs: The absence of upfront compensation details could lead to unexpected costs during the buying process. Lower-income buyers, who typically have tighter budgets, might find these additional costs burdensome​ (www.nar.realtor)​.

2. Affordability Challenges:

• Higher Overall Costs: If agents begin to demand higher commissions to compensate for the lack of standardized offers, this could increase the overall cost of buying a home. Lower-income buyers, who already struggle with down payments and closing costs, may find homeownership increasingly out of reach​ (HousingWire)​.
• Reduced Assistance: Some agents may be less willing to work with lower-income buyers due to the increased effort required to negotiate compensation, leading to a reduction in available professional assistance for these buyers​ (RealEstateNews.com)​.

3. Access to Services:

• Fewer Options: The changes might lead to a reduction in the number of agents willing to work in lower-income areas if the compensation becomes less predictable and potentially lower. This can limit the options and access to real estate services for lower-income buyers​ (RealEstateNews.com)​.
• Market Volatility: Ongoing legal uncertainties and market disruptions could lead to fewer listings and slower market activity, making it harder for lower-income buyers to find suitable homes within their budget​ (HousingWire)​.

4. Increased Complexity and Confusion:

• Understanding Agreements: The requirement for written agreements before touring homes can introduce additional complexity and paperwork. Lower-income buyers, who may already feel overwhelmed by the home buying process, might find these new requirements confusing and intimidating​ (RealEstateNews.com)​.
• Lack of Transparency: The reduced transparency in compensation can make it harder for lower-income buyers to understand the true costs involved in their purchase, potentially leading to mistrust and hesitation in engaging with real estate professionals​ (www.nar.realtor)​​ (RealEstateNews.com)​.

Conclusion:

These policy changes, while aimed at increasing fairness and transparency overall, can create additional hurdles for lower-income buyers. The increased costs, reduced access to professional assistance, and added complexity in the buying process can make homeownership more challenging and less attainable for this demographic. To mitigate these impacts, targeted support and education for lower-income buyers will be crucial, ensuring they have the tools and knowledge to navigate the evolving real estate landscape effectively.