NAR Litigation Settlement and the Major Changes
NAR Litigation Settlement and the Major Changes
Some of you may have been following the lawsuit against the National Association of Realtors (NAR). For those of you that have not, here is a quick summary, and then I will get into the changes. NAR and the larger national real estate brokerage companies were sued by a group of sellers stating that NAR violated anti-trust laws relating to the sell of residential property. NAR has a tentative settlement for $418 million and agreed to make some changes in broker agreements with buyers and sellers.
By agreeing to the settlement NAR:
- Received a release of liability for all members, associations, MLSs, and real estate brokerages (that had less than $2 billion in transaction volume) and admitted to no wrongdoing.
- Preserved the choices consumers have regarding real estate services.
Here are the major changes that will take affect:
- Sellers and buyers will each have their own separate agreement with their broker of choice.
- Sellers will sign an agreement with their broker only for the commission the seller will pay their broker. There will no longer be a commission in the MLS that the seller is offering to the buyer's broker.
- Buyers will sign an agreement with their broker only for the commission the buyer will pay their broker. The sellers can pay the buyer's broker commission through a negotiation in the buyer's offer. Any compensation offered by the seller's broker is credited against the buyer's obligation to pay. The buyer may end up not having to pay anything at all for the broker's services.
- Like the requirement for seller's to sign an agreement with their broker before they list their house, buyers will now sign an agreement with their broker before the agent can show them properties.
- All of these changes will go into effect by mid July 2024
These are some major changes, and it may be a little confusing. Reach out to me for any questions that you may have. I will keep you updated on any further changes.
