New real estate rules for home sales are impacting thousands of real estate agents.
The new rules, which went into effect on Saturday, followed a class action lawsuit against the National Association of Realtors (NAR) that addresses how real estate agents are compensated.
The lawsuit was settled in March, and the NAR agreed to resolve antitrust litigation that accused real estate brokers of inflating sales commissions, as reported by The Dallas Express.
Groups of homebuyers involved in the litigation were concerned that real estate agents were pushing them toward homes that would offer the agent higher commissions rather than homes that best fit their client’s needs. As part of the settlement, buyers will now negotiate with their agents on the commission the agent will receive.
Before the settlement, real estate agents posted their listings with the commission visible on Multiple Listing Service (MLS), a private database for real estate agents. As part of the NAR’s agreement, buyer agent commissions are no longer posted on MLS and will be negotiated before the agent shows the buyer any homes.
The NAR agreed to a $418 million payout and did not admit any wrongdoing in the lawsuit.
“The settlement makes clear that NAR continues to deny any wrongdoing in connection with the MLS cooperative compensation model rule,” stated the NAR in a settlement FAQ sheet.
“It has always been NAR’s goal to resolve this litigation in a way that preserves consumer choice and protects our members to the greatest extent possible. This settlement achieves both of those goals. … This agreement provides a path forward for our industry and NAR.”
The NAR says that the new rules will help to advance small businesses and encourage entrepreneurship due to the lower barriers to entry enabled by the MLS marketplace.
Since the settlement, real estate commissions across the nation have fallen slightly and could continue to fall further, per Axios.
The lawsuit affected over 60,000 businesses in North Texas, 150,000 in Texas, and over a million nationwide.
As per Dallas-Fort Worth’s housing market, the housing inventory is increasing while the median price has dropped slightly.
Housing reports show that the median price of a house on the market in July 2024 was $403,086, which is down 1.7% compared to July 2023.
Active housing listings have increased by 48.6% compared to July 2023, while the average house spends 78 days on the market, seven days more than July 2023.