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The NAR Lawsuit, Explained

So what’s going on with the National Association of Realtors lawsuit? We've seen headlines that real estate commissions are changing forever, that there's no more need for real estate agents....let's take a closer look.

Typically, when a home is bought/sold, the real estate agents for both buyer and seller are paid out of the seller's proceeds. The lawsuits allege that the NAR violated federal antitrust law by requiring that sellers pay the buyer’s real estate agent and thus pay an inflated commission. Arguably, this also increased home prices since the real estate fees were “baked into” the home price.

In order for a home to be listed on the MLS, the NAR required sellers to agree that the seller will pay a commission to the buyer's agent.

Assuming it goes through, this lawsuit has resulted in a $418 million settlement.

What does it mean? Real estate commissions are now fully negotiable.

  • It is no longer required for the seller to pay the real estate fees in order to list a property on the MLS

  • Any agent working with a buyer must have a written agreement with them outlining how much and by whom the agent will be paid

  • Sellers must clearly agree to pay for the buyer’s agent fees (if that is agreed upon)

Listing agents CAN continue to offer to pay for the buyer’s agent services, just not through the MLS. Sellers CAN still offer seller credits to offset buyer’s closing costs, which may or may not include a buyer's agent fee.

No one knows exactly how this will pay out, but the most important thing is that real estate commissions are now negotiable. We think it’ll result in a “tiered” system of pricing for realtors providing different levels of service for different fees. Any changes won't go into effect until later this summer.


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