The real estate world has been abuzz with talk about the National Association of REALTORS® (NAR) settlement agreement. But what does it all mean? Let’s break it down in simple terms.

Background

• The NAR recently announced a settlement agreement to resolve litigation related to broker commissions on behalf of home sellers.
• This legal battle caused uncertainty in an industry grappling with low inventory and interest rate increases.

The Facts

1. Misinformation Clarified:
   • Some media outlets got it wrong. They suggested that NAR previously set a standard 6% commission rate. That’s false.
   • NAR does not set commissions. Commissions have always been negotiable between brokers and clients.
   • Market forces influence housing prices beyond NAR’s control.
2. The Settlement:
   • NAR will pay $418 million over four years (pending court approval).
   • It resolves claims against NAR, REALTOR® associations, MLSs, and brokerages.
   • If it happens off the MLS, cooperative compensation remains an option for buyers and sellers.
3. What It Means for You:
   • Focus on your core mission: supporting buyers and sellers.
   • Correct misinformation and refer to official NAR sources for accurate info.
   • Keep using buyer representation agreements and stress the negotiability of compensation.
4. Three Key Takeaways:
   • Choice: Educate clients about their options regarding agent compensation.
   • Clarity: Be clear about your services and how much you charge.
   • Opportunity: Differentiate yourself, improve practices, and find creative solutions.

Remember, the settlement agreement aims to protect members and preserve consumer choice. Stay informed, communicate transparently, and continue serving your client’s best interests.

To read the original article about the NAR Settlement Agreement, click here.