I'm a New York real-estate agent who's not worried about losing guaranteed commission. Here's what I'm doing to replace those funds.

• Mukul Lalchandani, a real estate agent, discusses the impact of new commission rules.
• The new rules mean that sellers no longer have to pay the buyer's agent commission.
• These changes may most affect low-income buyers, but Lalchandani says his clients won't be affected.

This as-told-to essay is based on a conversation with Mukul Lalchandani, a 44-year-old real-estate agent from New York. It's been edited for length and clarity.

My parents wanted to buy a house in the US before immigrating here from Hong Kong, but they didn't know how real estate worked in this country.

They were working with the seller's broker and didn't realize they could work with a buyer's broker who would help them find the best deal. The seller's broker deceived them. They ended up spending a lot of money and had no house to move into when they arrived in the US. I decided to become a real-estate agent so I could prevent other immigrant families from going through the same situation.

I've lived in New York for 23 years and have been a real-estate agent for over 15 years. I established my own agency, Undivided, in 2023.

Most realtors in NY are not under the National Association of Realtors like the rest of the country. We have our own association called REBNY. The NAR and real-estate agents all around the country are preparing for new rules to pass.

One of the rules is that the seller no longer has to pay a commission to the buyer's agent. REBNY already implemented these rules starting January 1; the new rules were a shock for all of us. While the rest of the country is preparing for the rule changes, we're already seeing the results.

My agency has had to implement new policies to address the changes brought on by these rules.

Here's what the new commission rules mean

There is a lot of confusion around the commission rule and what it means, especially for buyers. The rules were made as part of a settlement for a nationwide lawsuit. When someone sells a property, they must pay their broker and the buyer's broker a commission. It's not fair to the seller.

The new rules will mean that the buyer will have to either pay for their own broker or not use a broker at all.

I've implemented two major policies in my agency to help with the confusion

First, I make sure to sit down with each buyer and explain to them how the new rules affect them. At first, my clients are confused. Then, when it clicks, they're shocked. They realize they have to pay for the broker themselves. They have an extra cost for buying the property which they didn't consider before.

My agency has also begun requiring all new buyers to sign an "exclusive buyers agreement." In this agreement, we outline everything we will do to help the buyer through the buying process in their best interest. It also states how much they'll pay us for our services. This contract helps clarify the terms and payment and prevents any confusion related to the new rules.

We have to implement this contract and charge our clients a fee because we no longer get a commission from the seller.

All buyers are shocked, but this will affect low-income buyers the most

My agency is a boutique agency in NY, and my clients tend to be high-networth individuals. The buyers who come to me are shocked when they learn about the new fees but can afford them.

Real-estate investors want a broker to find the best property for them, so they'll also be willing to pay the commission fees. Buying in NY is especially complicated, so buyers really need a broker. The new commission rule will not hurt people looking to buy expensive homes or investment properties. It will hurt the lower-income buyers the most.

Buying a property without a broker is possible, but the buyer is taking a risk. Higher-income buyers such as foreigners and out-of-towners who buy real estate in NY will avoid the risk and pay the broker fees to make sure they get a good deal. However, lower-income buyers around the country may not be able to afford a broker anymore. That means they'll be more vulnerable to getting into a bad real-estate deal.

For example, if someone is buying a million-dollar home, they would need about $15,000 to pay the broker now. That can't come out of pocket for most buyers.

Many Brokers will leave the industry, and some jobs will disappear

This also means that many brokers who sell only a couple of properties a year will leave the industry. Only brokers who work in real estate as their main source of income will be able to survive the new rules. Buyers will only pay for the brokers who have the most experience and get the best deals. In the future, we could also see bonuses for the buyer's brokers in a slow market that may not be offered in a hot market.

We might even see the job of a buyer's broker disappear in a few years. There used to be tenant agents who helped people find places to rent. That job disappeared when people looking to rent began talking directly with companies that own the properties. This could happen to the buyer's agent too.

If you're confused about the new rules, it's because they're confusing. Sellers were not happy with the previous rules where they had to represent the buyer's best interest by paying a commission to the buyer's broker. They'll no longer have to do that.

The new rules will have big ramifications as buyers start experiencing the changing real estate market.