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Note: This article is part of a special supplement to REALTOR® Magazine, “What’s Ahead for You?” published in April 2024.
By now, you’ve likely heard and read many stories about the National Association of REALTORS® proposed settlement to resolve nationwide claims brought by home sellers related to broker commissions. It’s important that you know the facts about the proposed settlement, which is why we have been blanketing members with emails, social media posts, podcast appearances and newsletter content. I hope you’ve found these resources helpful in understanding and digesting the settlement agreement details. In fact, I would encourage anyone who wants to truly understand the proposed settlement to read the full settlement agreement, which you’ll find posted at facts.realtor.
I strongly believe this outcome is the best we could achieve given the circumstances. Since this litigation started, our goal has always been to protect our members to the greatest extent possible while also preserving consumer choice. The proposed settlement achieves both goals. It also presents a path forward for NAR and allows our organization to continue providing unparalleled value to our members and American consumers. Some have criticized this settlement as being in the interest of the association rather than its members. The two go hand in hand. As a practitioner who has worked in real estate for more than 30 years, I have seen the unparalleled value NAR provides to its members and the industry. Whether it’s working to promote and preserve tax advantages for real estate purchasers, helping us fend off regulatory overreach, or defending the rights of property owners, our association operates with an effectiveness and integrity that is widely recognized and admired both in the U.S. and abroad. Anyone who has seen up close the many ways the association protects and advances our interests every day recognizes how important it is that NAR continue its mission.
The settlement would release well over 1 million NAR members and many industry stakeholders from liability in these matters. For those who were not included, I can say that there was no perfect option for resolving this litigation. NAR fought hard to include as many industry participants in the release of liability as we could. Ultimately, we could not persuade the plaintiffs to include the largest brokerages, particularly given the significant settlements that other corporate defendants had already reached. For most brokerages, the settlement provides a mechanism to obtain releases efficiently if those brokerages choose to use it. The settlement also calls for practice changes that will go into effect in around late July of this year. These include:
- Prohibiting offers of compensation on the MLS. Once the change goes into effect, consumers have the option to pursue offers of compensation off-MLS through negotiation and consultation with real estate professionals.
- Requiring MLS participants working with buyers to enter into written agreements with their buyers. NAR has long been an advocate for the use of written agreements as they can help consumers understand exactly what services and value will be provided, and for how much.
Since the settlement was announced, there has been no shortage of reporting on what it would mean for our association, the industry, and real estate professionals. I know that our members are adaptable and resourceful. Real estate is a relationship business, and each of us has a vital role to play in shaping how our industry evolves by communicating accurately about the practice changes and showing the value we bring to consumers and our communities.
This supplement brings you a few of the valuable resources available at facts.realtor and offers tips for talking with consumers about these changes. You can share your feedback with the magazine staff by sending an email to narpubs@nar.realtor. Your input will help us continue to provide the information and resources you need to find success through these changing times.
