How the recent NAR settlement will affect agents and the industry?
- Laura Maples
- Mar 24, 2024
- 2 min read
Updated: Sep 13
Have you heard about the National Association of Realtors recent lawsuit settlement? It's been making headlines, and there's a whirlwind of opinions swirling about how it'll impact various stakeholders in the industry: buyers, sellers, and real estate agents alike.
Here's what's on the horizon:
The MLS (Multiple Listing Service), a staple tool for most agents, will no longer publicly display the commission offered to the buyer's agent.
Why the change?
Allegations have surfaced suggesting that some agents might be biased in showing properties based on commission rates—favoring listings with higher commissions and potentially overlooking others.
What's the fallout?
Agents will now need to directly inquire about commission rates from the listing agent. In essence, buyers' agents will be encouraged, as they should have been all along, to prioritize showing homes that align with their clients' needs, irrespective of commission rates.
Additionally, buyers' agents will now require a signed buyer brokerage agreement, a step that's been optional in some regions and brokerages but will now become standard practice.
Why the adjustment?
This move aims to facilitate negotiation between buyers and their agents regarding commission terms, formalizing these arrangements within the contract.
What's the outcome?
Real estate agents will now be compensated by the buyer if the seller refuses to cover the commission—a significant shift from the traditional model.
As for the broader impact, it's a guessing game. The changes are set to roll out in July 2024, and speculation abounds. Some anticipate potential reductions in home prices, heightened challenges for buyers in affording homes, a shift towards buyers opting to navigate the market solo, while sellers may continue paying commissions to attract buyers and agents.
Only time will unveil the true implications.
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Great job on the article! You should post this in some of the Real Estate Forums on social media. People are constantly confused about what exactly is going on and how these changes are going to affect Agents. As you stated “It’s a guessing game” when it comes to the impact and the way the market will respond.