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Each week on The Download, Inman’s Christy Murdock takes a deeper look at the top-read stories of the week to give you what you’ll need to meet Monday head-on. This week: The Consumer Federation of America raised eyebrows and hackles with its advice to pay only the equivalent of a 2 percent commission for both real estate purchases and sales.

In recent years, real estate professionals have been inundated on all sides with the suggestion that they’re overpaid, underqualified and failing at their fiduciary duty to clients. Words like “collusion” and “conspiracy” have been thrown around, triggering anger, grief and disbelief throughout the industry.

Now, as the aftermath of commission lawsuits and subsequent settlements rolls on, and as we near the Aug. 17 implementation of the terms of the National Association of Realtors (NAR) settlement in particular, we’re starting to get into the nitty-gritty of the impact on agents and brokers. That means looking at what will actually happen to commissions in the days, weeks, months and years ahead.

EXTRA: Average buyer’s agent commission has fallen since NAR settlement

When NAR’s settlement was first announced, reactions ranged from relief that the uncertainty of ongoing litigation was over to anger at the new normal that would result. One popular refrain was that with commission negotiations normalized, agents would actually make more under the changing paradigm, negotiating higher commissions to reflect their unique value proposition.

Now, that optimistic take is looking less likely.

Last week, the Consumer Federation of America (CFA) laid out advice for buyers and sellers to help them negotiate their agents’ commissions and save money throughout the transaction. They advised buyers not to agree to pay an agent just to see a home, but rather to sign a touring agreement with no financial obligation instead.

Most controversially, they advised consumers to set a goal of 2 percent or less in dollar terms for representation.

Asked how CFA arrived at that 2 percent figure, CFA Senior Fellow Stephen Brobeck told Inman’s Andrea Brambila, “The 2 percent or less is my best judgment as a realistic goal most homesellers and buyers could aspire to and attain. Already in some markets, most buyer agents are charging 2 percent (but listing agents are unfairly charging more).”

The consumer watchdog organization also offered guidelines for vetting an agent, including working with a broker instead of an agent, checking out reviews on sites like Zillow and Realtor.com, and asking for contract forms and proposed terms upfront so that they have more opportunity to review them and ask questions.

EXTRA: What’s changed since NAR struck its deal: Client Pipeline Tracker

Mad as hell at the idea of a 2 percent commission? You’re not alone (just check out the comments on that story), but it’s vital to gain a 360-degree view of what’s being said from every perspective. That allows you to understand your options and avoid being caught flat-footed at your next buyer consultation or listing interview.

To deal with the uncertainty and frustration, you have two choices: scream into the void or rethink business as usual. That may mean adding leverage with technology, a team or a virtual assistant. It almost certainly means changing the way you talk with your buyers and sellers. In addition, it will require you to rethink the way you work and reset your expectations.

Every week, Inman contributors offer an array of ideas to inform, inspire and empower you to shut out the noise and keep moving forward. Here’s the latest:

Communicate value! But how? A step-by-step buyer’s presentation

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A surprise drop in mortgage rates brought homebuyers out of the shadows in July, according to Seattle-based brokerage Redfin’s latest market report.

Thirty-year mortgage rates dropped to a daily average of 6.34 percent on Aug. 5, the lowest level since April 2023. Although the daily average has since risen to 6.58 percent, it’s still a needed reprieve. In the last month alone, moderating rates have given homebuyers a $30,000 boost in buying power, boosting the typical buyers’ budget from $437,000 to $466,000.

Thankfully, the drop in mortgage rates has coincided with cooling median sale price growth.

The median sale price for the four weeks ending Aug. 4 was $389,750, a 1.51 percent or $6,000 drop from early July’s all-time high of $395,750. Although the 1.51 percent change represents a “typical seasonal decline,” it also represents the smallest annual increase (+3.2 percent)  in median sales prices since December.

Moderating mortgage rates and home prices have encouraged homebuyers to begin weighing their options, as evidenced by several key touring metrics. The Redfin Homebuyer Demand Index, which tracks requests for tours and other homebuying services from Redfin agents, declined 13 percent year over year, the smallest decline in three months. Meanwhile, ShowingTime tour requests have increased 13 percent from January, and Google searches for “home for sale” rose 4 percent from June.

However, increased interest hasn’t translated to sales just yet. Pending sales, a forward-looking indicator based on contract signings, logged its largest annual decline in nine months at -6.7 percent. The late-July drop in mortgage rates didn’t yield an increase in offers written with Redfin agents, the report said.

Shoshana Godwin

Despite the stall in offers and pending sales, Seattle-based Redfin Premier agent Shoshana Godwin said she’s seeing more homebuyers move forward on their plans as they fear rates will drop “too low” and spark a 2020-esque frenzy.

“Many of the buyers I’m working with are excited because they’ve been casually house hunting for a year, waiting for rates to come down before they make an offer,” she said in a written statement. “Now a lot of those buyers want to get in now, before rates get too low and cause more competition.”

Unlike in 2020, where homebuyers snapped up whatever was available, she said today’s homebuyers are very discerning — only making offers on move-in ready listings.

“One of my listings, which went on the market last week, had over 100 parties come through and received nine offers,” she said. “Buyers are securing lower rates than they were a few months ago, but costs are still high enough that buyers are picky. If they’re going to have a high monthly payment, they want a move-in ready home so they don’t have to pay for upgrades.”

It looks like homebuyers will have more to choose from in the coming months, as new listings rose 5.9 percent year over year during the last four weeks ending on Aug. 4. Those new listings, matched with a growing share of stale listings more than 30 days old, have bolstered inventory to 3.4 months of supply at the current sales pace.

And of those listings, 7.2 percent experienced a price drop, further signaling the movement from a sellers’ market to a balanced market.

Email Marian McPherson

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Despite improvements in housing affordability, homebuyers are showing little interest as property sales continue to decline.

Pending home sales have dropped 5.7 percent year over year, the biggest decline in nine months, Redfin reported on Thursday. Mortgage-purchase applications are down 14 percent or 2 percent week-over-week.

Although it is becoming more affordable to purchase a home, prices and payments are still near record highs.

The median U.S. monthly house payment was $2,667 during the four weeks ending July 28, according to Redfin, the lowest level since March. Falling mortgage rates and sale prices are causing payments to decline.

The weekly average mortgage rate sits at 6.78 percent, down from May’s five-month high of 7.22 percent. The median home-sale price is down nearly $4,000 from its early July peak at $392,563.

Redfin agents report that some prospective homebuyers are waiting to learn the outcome of the upcoming election before purchasing a home.

A lack of desirable listings has also contributed to the decline of home sales.

New listings have shown the smallest increase since November, up 4 percent year over year. With nearly two-thirds of homes sitting on the market for 30 days without going under contract, it is fair to say that listings are not matching buyer expectations.

The small increase in listings can also be attributed to limited demand, though Redfin agents have seen a demand for turnkey homes in desirable neighborhoods.

Agents expect sales to pick up as mortgage rates are projected to decline. In comments yesterday, Federal Reserve Chair Jerome Powell dropped hints that the central bank may be ready to cut rates if it sees the economy weakening in the months ahead, possibly as early as September.

“Local buyers are still worried about affordability, especially since wages haven’t caught up with home-price growth and inflation has cut into their budgets,” Boise, Idaho, Redfin agent Nicole Stewart said. “But now that rates are declining, some fence-sitters are getting off the fence.”

Email Richelle Hammiel