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The National Association of Realtors agreed to a $418 Million settlement on March 15th. Maybe you’ve seen some of the headlines, many have been misleading, however.
The $418 Million settlement agreement was a result of several class action lawsuits alleging their requirement to offer buyer’s agent compensation in the MLS basically amounted to price fixing in the industry. What will change?
• Assuming the agreement is approved, the field agents see in the MLS for buyer representation compensation will no longer exist.
• Sellers will no longer be agreeing to a buyer’s agent payout upfront at the time they sign a listing agreement. They will agree to a listing representation commission only.
• Buyers working with an agent will negotiate their agent’s commission independently. They can still negotiate compensation for their agent when they make an offer on a property, but if the seller doesn’t agree to paying it, the cost would fall on the buyer’s shoulders.
The ripple effect in the industry remains to be seen, but this is a significant change to the way Realtors and consumers buy and sell homes. The cost to sell a home will likely come down, which isn’t a bad thing, but the cost to buy a home will likely go up, which would hurt for a large segment of home buyers who already are feeling pinched by heightened competition, elevated home prices and, higher interest rates.
Message us if you have questions about this change or anything real estate related!
