Good morning, and welcome to another Motivational Monday. My name is Matthew Hodge, executive vice president here at LPT Realty. And today, I'm in Lake Mary headquarters, LPT headquarters. I'm gonna bring in Robert who's gonna be joining us from New York. There he is. Robert, how are you? Oh, you're muted. Let's get you unmuted. Alright. There you are. There you are. Yeah. We can hear you. Cool, man. Awesome. Good to see you, man. Mute. Yeah. Yeah. We did. We had you on mute. We we did it on our end remotely. Good morning, man. I see you in a suit. Wow. You look great. We're we're normally seeing you in a T shirt and flip flops. So you look very put together, this morning. I know that, last week, for anyone who doesn't know, we traveled. The executive team was in Arizona, and then we went from Arizona to New York. Robert stayed there. Lewis had a bit of a schedule. He went back to Florida to and to Cancun for a family function. I came back on Friday, and you are there throughout the rest of the week with Matt Levy, our chief strategy officer. So you dressed up this morning. Tell me what's going on. Yeah, Hey, man. I'm coming to you from the twenty first floor of the beautiful Carlyle Hotel on Manhattan's Upper East Side, and, I'm going to meet with the team at JPMorgan at twelve forty five. So as soon as we wrap motivation Monday here, I'm jumping in the car and and heading, down to Midtown. But, yeah, exciting. You know, a lot of lot of decisions to make. You know, we're we're on kind of this final leg of this journey of getting things figured out, you know, for the next fifteen months and and our plan to to look at the capital markets and, really, really exciting day. So, yes, I I do actually own a few ties. I own a few suits. And, there are times when I guess I have to look a little more like a CEO than others, and today happens to me. That's right. Yeah. I remember, a few years ago, you said my goal is to never have to wear, you know, dress up again. Like, usually, people are coming to me. I don't dress up for people anymore. So I know this is important, when I see you dressing up. And, I know you've got some some big decisions to make here and some information you gotta absorb. So we're looking forward to see, kinda what comes from, from the guidance that you received this week. So okay. We're gonna jump right in. So, you know, last week was somewhat of a big week. We know that we've had some, you know, interest rates that kind of jumped up, and we we we may talk a little bit about that, later on today. But the biggest news is that we saw the approval from the NAR settlement. And so it seemed like they have approved the language. And while that doesn't mean things are enacted, just to put that up front, things haven't changed yet. They did approve the settlement. So can you kinda walk us through what that means and and kinda how you see that unfolding? Yeah. So, you know, the basically, NAR and the plaintiffs came together and and came up with this proposed settlement, and that was the language that we all saw released. You know? I guess it's been a little over a month now. And so now the judge has preliminary approved, preliminary approval of that settlement. So the judge looked at it and said, you know what? I think this, you know, this is fair. I think this is equitable. This is I'm gonna recommend this, and we're gonna get this done. And so the judge gave preliminary approval. There will be an actual hearing to give formal approval that's scheduled for later this year. Our hope is that kind of the timeline from here is now that the judge has preliminarily approved the settlement, that now NAR will actually put out the language of the new rules because that's the piece that has to happen next. If you read the actual settlement, it says things like, you know, NAR will change its rules to reflect this. NAR will adopt a rule to reflect this. And so now, you know, NAR has to actually write those rules. And and we think that we think they've probably been working on it, but we're probably not not gonna put that out until they had their preliminary approval from the judge. So the hope is that we get the actual NAR rule set published here in the near future. I'm sure that'll be big news when it happens. I wanna say what, Matt. It was last Tuesday or Wednesday? I guess it was Tuesday. We were we were in Phoenix. Tuesday or Wednesday. Yeah. We were we were just in Arizona, so we were probably just, yeah, around that time frame. So, again, we'll give them a little bit of time. As soon as that happens, then we can go to work now understanding exactly what the new framework is gonna be, make sure that the buyer tool's working on, the new buyer broker agreements, everything that we have cooking behind the scenes is compliant with the final rules from NAR. And and I think, you know, look, I think it's gonna be good. I think some of you are seeing that messy period we're in right now where you have some people that are trying to adopt the new rules early, but, obviously, then NAR has, you know, ethics rules and things that prevent the type of negotiating, that needs to happen under the new rule. So a lot going on there. One one critical piece I do wanna point out, we've we've dug in pretty deeply, you know, to the NAR rule that says, you cannot make an an offer contingent upon, changing commission. And and there's actually we we found a case where NAR had one of these go all the way up the chain and and kinda argued about it. And in the end, they kinda what they said is that, merely asking the other broker if they're willing to entertain a commission change is not a violation of I think it's I think it's, what, sixteen sixteen, whatever whatever that is. Sixteen sixteen. Correct. Simply asking the other broker is not a is not a violation. It's it's submitting an offer that has the offer contingent upon a new commission. And so, you know, that that interpretation means you can call the listing agents now and say, hey. You know, would you be willing to to look at this amount of commission, paid to my buyer broker now, and they can talk to their client about it? What is what is an ethics violation currently is submitting an offer that is contingent upon an amount of commission. That will be the way we do it, you know, as soon as the new rules are adopted, but that's not allowed right now. So, again, we're in that messy middle right now, but you can actually call and have that conversation. I know some folks, you know, and before I think we even we dug in deeper, maybe thought the calling itself wasn't allowed. We really did a lot of research on this, understand exactly where this falls. But you can. You can call the other agent and try to negotiate something. You just cannot submit the offer in writing contingent upon changing commission. And then after you've prediscussed it with them, then you can add it to the contract, then it's allowed. But you cannot just blindly submit the contract to make them contingent upon new commission. You have to have that conversation with the listing agent first in order to avoid the ethics complaint. We don't believe I mean, I'd like to think that NAR isn't going to enforce that during this really mess messy period here in the middle. Obviously, if someone does get tagged at LPT for trying to do the right thing for their client, we're gonna have your back. But at the end of the day, we are in this weird period right now where where this shift is coming. There There are literally rules on the books today that prevent us from doing it the new way, and then we have agents out there who are trying to do it the new way early, and we all just have to try to get to this together as an industry through the next couple of months. Yeah. And so real quick, just to clarify, when you're saying an offer that's contingent, are you saying that someone can't say, hey. You have to accept my offer and pay this or our offer is retracted. Is that what you're meaning by that? Yeah. You can't just blindly submit an offer that says, you know, that has an addendum that says, you know, selling, you know, buyer broker. Seller will pay buyer broker three and a half if MLS says two and a half. Gotcha. Okay. I'm with you. Call the listing agent and say, hey. Would you be willing to pay this amount? You know? And, again, you could write it as a seller concession, but you cannot write an offer that has a a clause in it or an addendum saying, you know, this offer you know, basically, the the part of the terms of this offer is to change the pre negotiated commission by the listing agent. You can ask for concessions. You can make a phone call and have that conversation and pre agree to it before it goes into the offer, but you cannot just submit an offer contingent upon you know? And, again, that that's the best interpretation we've been able to find. This is one that I don't think saw a lot of traction. Like, I I don't think this is something people really did much of, And so I don't think NARS really had to adjudicate a lot of these. We dug around and found what we could, and that's the best interpretation we can come up with. And honestly, again, we'll we'll be here to have our agents back if you're doing what's in the best interest of your client and get caught up in a, you know, a a small misstep in how the rules are written during this period of, you know, this period of, quite frankly, chaos, you know, where people are not quite sure how to proceed and, you know, what the new normal is. We have we have sellers who wanna adopt the new rules. We have buyers who don't. We have agents who do, agents who don't, a set of rules from NAR that won't allow us to. This really is gonna be probably one of the toughest little periods of our career. And I gotta say, you guys are doing an amazing job with it. You know? We we are we are a little down the road here. We've had some time under our belt. We have not seen a lot of issues with with LPT agents. You guys have had a done a great job. You know, your consumers are continuing to buy houses. You're getting those listings. You're getting deals to the closing table. We we have not seen a massive impact yet from all the headlines around the settlement. Yeah. You know, one of the things that we constantly talk about here too is, you know, the best use of your time right now is understanding that the, you know, the landscape is going to change. Your conversations with your buyers are going to change. Enacting rules that today, that's not the best use. Right? You could adversely hurt yourself if you try to go rigid and say, hey. Well, I'm not working with anyone unless you start doing this now. Like, that's not really of course, it's up to you, but we are definitely not recommending that. It's really about understanding that the landscape is changing, that the conversation's gonna change, and that if you are currently working with someone, you may want to start telling them that this change is coming. Hey. Right now, we're not gonna have to do this. But in the future, there could be an opportunity where maybe we've submitted an offer, it didn't work out, or we're looking for a house, you haven't found it yet. But by maybe the time you do find it, you know, I know here in Florida, they've talked about, putting this in place by July. You could run into a situation where you are gonna have to change the conversation midstream while working with someone. The best thing to do is start educating them now and preparing themselves because, again, the conversation is going to change. And that's really the best thing that we can do right now is prepare ourselves on how to talk through that and maybe, you know, start to forewarn the people who we're currently working with that this change is coming so that it's not, you know, a friction point as as we move forward. But like you said, Robert, we've got their back. And, you know, I can't really see them being very aggressive with someone who's trying to do things right now. I mean, I don't see that being, you know if the rule wasn't changing and then they were doing this, maybe it's something. But as people are trying to adjust to it, I think there's probably gonna be some leniency there, I would imagine. But again, you know, again, we don't we're not under any obligation to change the way we do business today until we've got the those pieces in place. So Yeah. And so, look, we we did have our first external complaint coming about this, which is why we've been researching it. You know, we we had a deal where I believe there was a zero b a, you know, buyer's agent commission. Our agent calls the listing agent, you know, ask if they're willing to contribute. I think it was two or two and a half. Agent then calls us threatening ethics complaint. You know, we're gonna bring down the world on this agent, and that's when we really dug in. And, again, making the phone call first is what in in our opinion of reading the the framework prevents it from being an ethics violation. Now if you wanna go ahead and get something signed between you and the agent earlier, if you wanna do that with the contract, the key is that the offer is not blindly submitted contingent upon the commission. And there's a lot of different ways to do this. If you find yourself in this situation, you can always submit a ticket, reach out to our internal broker hotline, reach out to the state legal hotline. But we we had this come up recently, which is why we've been looking at it. Other big thing, you know, that happened in the last couple weeks is, you know, Fannie Mae and Freddie Mac came out and clarified that, if a seller is paying buyer's agent commission, that is not going to count toward concessions. It's interesting because I I at my mortgage companies, we've always treated it that way. You know, if you think about for sale by owners, you know, if you think about builders, a lot of times there is no listing agent. And so the mere fact that there is no listing agent and the seller is compensating a buyer's agent, quote, unquote, directly, didn't change our opinion of how commissions get treated. And so I was glad to see that Fannie and Freddie came out, and said, hey. Like, we wanna clarify this. That is not our policy. Because a lot of lenders were kinda creating this fear around that, you know, telling agents that it was gonna count toward the the seller concessions if it if it wasn't a listing agent splitting it with the buyer's agent, if it was the seller paying the buyer's agent directly. So, again, there's there's a lot of lot of misinformation out there, a lot of confusion out there, and we're gonna continue to work through it together. You know, we'll kinda bring you high level information here on Motivation Monday. Again, this is not meant to meet every possible scenario. We have amazing support, you know, through through chat, the ticketing system, through phone calls, to our brokers. Again, we we've got your back here. But, again, we wanna use Motivation Monday to kinda share the high level things that we're seeing pop up because we did see that that first agent make an erroneous complaint against one of our agents, and we were able to to respond to that, you know, using the research that we did. Yeah. And it's also important to note that each state is on their separate timelines, and so that is probably gonna be a little bit of a confusing period as well too. Again, I know Florida has talked about July, but I know other states have talked about different months. I believe it's supposed to be fully enacted by, I've heard December of twenty twenty four or early twenty twenty five. But, again, your state may decide when they wanna start to make those forms available and when they would like you to switch over. So we will get you that information on a state by state basis. But to Robert's point, this was just kind of a high overview of letting you know generally, this is how things should should look. And, again, each state will kinda make their decisions by their their own regulators when that when that is gonna be, in effect. So, but yeah. Again, I think that's a big win with what you just said, that it is not going to be considered, you know, concessions. I think that's a a big weight off of some people's shoulders who were concerned about that. So there is still a financial path to make that simple. I think there are there was a lot of people who may be concerned that, hey. Buyers are already having to, you know, spend so much money on down payment. Will this impact them in a way that keeps them from now purchasing? And it sounds like there's already some solutions being made where those things can be, you know, put into financing or it's not gonna be considered against seller concessions or things like that. And so that's exciting to hear. You know? Again, we are still working through a lot of this, but, you know, no no reason to fear. We're gonna we're gonna be fine, and, of course, we're gonna make sure you guys have got the best tools, to succeed in this, instant environment. Yeah. Essentially, you know, the concession piece is interesting because you can always ask for concessions in a contract. You know, you can always ask for, you know, six percent concession toward buyer costs, and some portion of that can be used for buyer's agent commission. Some portion of that can be used toward closing costs. You know, asking for a seller concession toward buyer costs is not going to be considered negotiating compensation in a contract. And so, again, now that that has been clarified, again, again, there's there's a lot of different ways for us to, again, react, get to the ultimate result we want to, which is representing our clients at the highest level. You know, one of the things I I shared, I traveled around a little bit and and, met with, one of our teams up in Jacksonville, Chris Snow and his group, and and we kinda came up on this topic. And I said, you know, basically, my my feeling to this is this is not the Department of Justice thought that realtors make too much money, you know, that the commissions are too high. That became the rhetoric rhetoric around this. Yeah. There's a lot of reasons why, you know, we are a success based industry. You know, we we take the burden of all of the hundreds of homes that we show people that they never buy. We take the burden of listing photos and things when a when a listing doesn't sell. And the American consumer, is very much interested in success based pricing. You know, we talked about Redfin when they tried to go out with the pay pay upfront model, you know, and how that didn't work. Consumers don't wanna pay every time they view a house. A lot of the reason that the the very low cost listing companies have not gotten traction is because they require the consumer to pay upfront. And there's only so many consumers that are willing to pay that nine ninety nine listing fee or whatever the number is upfront. They'd rather have the success based fee. They'd rather know that you got them the offer they wanted, that they were able to say, yes to before they have to pay you anything. It's just it's it's very much the way we look at this industry. And and so I think kind of the biggest issue or the biggest thing that I I kinda read between the lines are looking at all these different objections for the Department of Justice, all the different kinda opinions around this is what would really upset the Department of Justice or what they really felt was not not right was you have a buyer's agent and a buyer. Right? And so the buyer who chose the buyer's agent did not determine the compensation for their agent. And then the seller who chose the listing agent didn't choose the buyer's agent, but chose the compensation for the buyer's agent. And so if you look at the new framework, what they're really trying to get to is they want the consumer who hires the agent to be the one who negotiates the amount of commission for that agent. Now they're not saying who actually pays it. In the end, it's okay for the seller to pay it. The buyer can pay it themselves. Like, all those different mechanisms are coming out. But what they're looking for is to say, look. If if Robert, the buyer, chose Matt, the agent, then Robert should negotiate what Matt's commission should be, not leave Matt's commission to chance based on the property that Robert ultimately falls in love with. And that really is the the the quote, unquote shift that we're seeing here, and everything else, I think, is really noise. And if we can get through the noise and understand that making that change is going to be messy, difficult, everything we're going through right now. But at the end of the day, I know personally, I would much rather be the ones to negotiate my commissions with my client than to find out what I'm going to make down the road because the seller, you know, the sell the listing agent decided to pay less of a buyer's agent commission or the builder decided to pay less. I really do I continue to firmly believe this is gonna actually bring, you know, more consistency and control over our business to buyer's agents, having this ability to negotiate the commission upfront, have our client agree to it. And then at the end of the day, in most cases, the seller is going to be willing to pay it because they wanna sell their house. And that, you know, that that's kind of the situation that we see. Yeah. And I I agree with you. You know, I I'm on the side that I would much rather be in control of my own commission versus you're right. It just being attached to whatever the house and not even have a say inside of that. So I think that, you know, it is going to be a positive for those people who want to be in control of that. And if that's uncomfortable for you, there's a ton of things that you can do from a skill set perspective and trainings that we'll have to help you walk through and show your value which is really what's gonna be the key factor is how do you show your value to say, hey, I'm worth whatever I would like to be you know, whatever I'd like to charge. And so I think it's a positive for the industry. Again, I think that there is the messy period to your point, but I do think that we land on another side where, you know, people are in more control of their finances, and it's a cleaner overall transaction. So definitely looking looking forward to what that could bring. Hey, Robert, I know you wanted to do a quick poll, to try to figure out, what how people were viewing. So let me pull that up real quick if you wanna explain, what we're doing there. The poll. Here we go. Okay. So, just wanted to try to find out in terms of, how you are viewing Motivational Monday. So we're gonna launch this poll. You've got a couple different options here. And is are you watching Motivational Monday solo? Two to five people, six to ten, or ten plus. Yeah. Look around the room right now. Count everybody. You know, we we have a lot of agents we found out who get together in groups to watch motivation Monday together. And so, there should be a poll popped up on your screen with those four choices. I got a little box I see popped up that, you know, says motivation. It's going right now. You oh, you can't see it. Right? You can't see the results? Okay. So I can see it. We'll give it another couple of minutes. We are about seven hundred votes in right now. So, we'll give it another couple seconds, and we'll see. Let's, let's do a guess, Robert. Where do you where do you think things are are landed? Oh, man. I I don't even wanna take a stab at this. You know? Okay. Alright. Cool. Think we're still overwhelmingly solo, you know, because I think that's just the nature of Zoom. But I've heard so many examples of people getting together, like, have these group agents get together at someone's house and have, you know, bagels together or a lot of the team offices or hubs will get together. So I'm I'm really curious. I you know, this is a this is a sincere curiosity for me to see kinda what this looks like across our ecosystem of people getting together to make make Motivation Monday a community event. Yeah. That's right. Alright. So let me go ahead and display this. It's gonna display it in percentages, but I can see the actual numbers here. But let me let me go ahead and, share these results. Can you see that? I do. Yeah. Okay. Perfect. Yeah. So eighty nine percent of people are watching solo, which was, out of this poll, six hundred and six six hundred sixty seven. But we do have ten plus. There's five groups of people who are watching ten plus. So, that's pretty cool. You've got six to ten, range at one percent and two to five at nine percent. So sixty eight people are watching it. Obviously, they're just one vote, but sixty eight groups of people that are between two to five. So that's it's interesting to see. Again, I know I imagine a lot of people, like you say, would be watching it, solo, but the we do have those hubs and people who are getting together. So we're excited to see that and hopefully continue to shift that dynamic where people have an opportunity to meet each other in person while also, digesting what's in motivational Monday. I I gotta imagine some of our bigger groups are probably trying to find the keyboard to to to get on that. Yeah. Absolutely. Absolutely. Cool. Alright. Well, we are we are pretty much almost at time today. A little bit of a shorter, motivational Monday, but just wanted to make sure we touch based on, that language, approval or preapproval, because we know there's a lot of questions around it. And so there's still some fear around it, but I think that the industry has done a good job of starting to absorb it and move past it. And you know, again making it not the thing, and just it's it's where we're going to and, you know, again you talked about this Robert that the people who embrace change are the people who obviously get their unfair share, advantage of of the of the change. Right? Change births opportunity. And so we want you guys to be in position to embrace this so that you can have the opportunity to, you know, excel through this environment versus it being something that hinders your your business. But, any final thoughts as you're wrapping up? I know we didn't really talk about all the things that we did in, New York there. I know you met with, the, I was gonna say the, MLS, but not the, listing service, but the soccer, headquarters you were there and, you know, kinda negotiating that for the Jacksonville Armada and some exciting things coming on the future there. But any final word as you wrap up your week here in, New York? No. Look. It's it's been a great trip. You know? I'm I'm ready to get home. We're going home Wednesday. You know? It's been a lot going from Phoenix straight to New York, but a lot of great information, you know, being involved in the, you know, the t three sixty event out in Phoenix. That's part of that Swanepoel Power two hundred list. You know, getting to get on stage there and, you know, share some great insights, with some other CEOs and and the industry leaders, and then, you know, hopping and flying over to to New York, getting involved in the radio and television experts. We had a lot of great, agents I knew there and and met some new great agents from across the country who are using TV and radio in their business. If you don't know radio and television experts, it's the the group that has the Barbara Corcoran endorsement. So if you've ever seen the agent in your market who's doing their TV commercials with Barbara Corcoran from Shark Tank Shark Tank, that's that's put together by a gentleman named Matt Wagner who runs this group. You know, I I did a session there on lessons I learned spending a hundred and fifty million dollars on TV and radio. I'm gonna redo that, with couple cameras from the studio, and we'll get that loaded into Connect. And then again, you know, big big meetings coming up this week, before we head home. We did have the meeting at Major League Soccer on Thursday, and then Matt and I borrowed their conference room to do real estate first Friday, from the Major League Soccer headquarters, which was pretty cool. If you're not tuning in for Real Estate First Friday, I would encourage you to. A lot of lot of good information there as well. And now today is the big JPMorgan meeting, so just a lot of great stuff going on. We're out here working hard for you guys, you know, traversing the country. It really is, it's amazing what we've done here together, you know, being a a two year old brokerage, the numbers we've put up, the the culture we've built, the community we've built, and and things are just getting started. You know, I I tell a lot of people that, you know, that this this first piece of the adventure is really just a starting line. And, you know, once we're in all fifty states, you know, once once we're traded on the capital markets, you know, once all these things take place, it really will, give us a lot of opportunity to change more lives to to impact the industry in an even bigger way. And and that that to me is the starting line. You know? This is kinda this is kinda preseason right now, and we're winning, and we're getting ready. But, you know, I think our industry is gonna continue to to morph and change in the coming years, and LPT is here to be a beacon and help our agents survive and thrive. And that happens by all of us coming together and supporting each other and having this amazing community and having this amazing culture. And as connect two point o comes out of the ground, you know, in the next couple of months here, and we continue to just build on the foundation that we have, I I can't wait to see, you know, where where this guy takes us. I, I know I say it a lot, but I I wake up proud every day to be the CEO of this company and and more excited than I had in a long time in my career. I had a lot of success in the mortgage business and other places, but, yeah, I really do get up more fulfilled and excited about what we're doing together here at LPT Realty than than any time in my life I can remember. So this is really special. I'm excited to share it with all of you. I'm excited for you to share it with us. And and, yeah, man. It's, we're we're winning. We're winning big, and we're winning together, and that's what's most important. That's right, man. That's right. Well, thank you for those encouraging words, man. Have a fantastic, meeting today. We all look forward to catching up next week and kinda hearing how that goes. I look forward to seeing you back in Florida here on Wednesday. And, guys, again, if you don't have the opportunity to to or you haven't been attending Real Estate First Fridays, definitely check it out. A lot of actionable items that you can utilize to implement inside your business, whether you're a large team leader or a single agent. R. P. Talks a lot about his experiences even from a mindset perspective and what the kind of entrepreneurial mindset he's had to adopt to build these businesses. So a lot of gold nuggets there. We're gonna be doing some things which is bringing on agents as well as featured guests onto Real Estate First Fridays where, it will be an assortment of large team leaders and single agents and just giving you guys an, you know, variety of of people's minds to hear from, so that you can then pull what elements make sense in your in your business. So thanks for taking the time, Robert. Always on Monday to, you know, give us the guidance here. And then on Real Estate First Fridays, giving us actual items that we can implement in our business to go faster. So, looking forward to seeing you again, brother, and, we'll see you guys soon.