NAR Settlement: What Real Estate Agents Need to Know

The National Association of Realtors (NAR) reached a settlement in March 2024 to resolve a class-action lawsuit brought by home sellers. The lawsuit alleged that NAR policies regarding commissions on the Multiple Listing Service (MLS) inflated home prices and stifled competition.

The settlement requires several changes that will impact real estate agents:

• Elimination of MLS buyer agent compensation offers: Previously, MLS listings could offer compensation to buyer's agents. This practice is now prohibited.
• Increased transparency in buyer agent agreements: Buyer's agents must now provide written agreements outlining fees and services before working with clients.

These changes may lead to more negotiation around commission rates and a shift towards commission models outside of the traditional buyer-seller split.

For real estate agents, the key takeaway is to adapt to a more transparent and competitive landscape. By clearly communicating their value proposition and offering flexible commission structures, agents can continue to thrive in the post-settlement environment.