Paid Advertising Content | By Kari Fleck, The Real Estate Collection
The 2024 settlement by the National Association of Realtors (NAR) marks a significant shift in how commissions are handled, impacting both buyers and sellers. If you're selling your home, it's essential to understand how these changes may affect you, especially regarding the buyer’s agent commission.
Why the Settlement?
The settlement follows a class-action lawsuit alleging that NAR's former policies inflated commission rates and lacked transparency. The goal of the settlement is to provide a clearer and fairer process, offering both buyers and sellers transparent, upfront information about commission structures.
What’s Changed with the NAR Settlement?
Commission Transparency: Previously, sellers typically paid the buyer’s agent commission, often around 2.5-3%. With the settlement, commissions for buyer agents must be fully negotiable and disclosed upfront. The buyer’s agent fee will no longer be automatically listed on the MLS, creating more freedom to negotiate commissions.
Flexibility in Commission Agreements: Sellers now have more control over commission negotiations with their REALTOR®. This change means the buyer’s agent commission is no longer automatically included in the sale price, giving sellers the flexibility to negotiate a commission structure that works for them.
Buyer Agent Compensation Remains an Option: Sellers can still offer compensation to the buyer’s agent, but the agreement must be documented in writing before payment, ensuring clarity and preventing misunderstandings.
A Shift in Standard Practice: Buyers must now sign a commission agreement with their REALTOR® before viewing properties. If a seller does not offer a buyer’s agent commission, buyers have the option to not consider those homes in their search.
These changes bring more flexibility and transparency to commission arrangements. While sellers can choose whether to offer a commission to the buyer’s agent, doing so still provides significant advantages in attracting qualified buyers. Working with an experienced real estate professional remains key to navigating these new dynamics successfully.
The Real Estate Collection | www.TheRealEstateCollection.com | 407.656.7814 | 100 W Plant Street, Winter Garden, FL 34787
