The National Association of Realtors (NAR), in a recent settlement, has agreed to make changes that could potentially save homebuyers thousands of dollars in broker commissions. The changes are a result of an antitrust lawsuit charging NAR with collusion to overcharge home sellers by requiring them to pay the buyer’s agents’ commission at an inflated price.
Traditionally, the seller pays the commission for both the listing agent and the buyer’s agent, often totaling up to 6% of the home’s selling price. This cost is effectively embedded in the sales price and often indirectly paid by the buyer.
While the settlement does not directly reduce commission rates, it mandates changes providing more transparency to consumers. Under the accord, real estate agents will have to disclose commission rates to buyers before they show homes, so buyers could potentially negotiate lower fees.
Moreover, the regulations will also allow brokers to represent both buyers and sellers in the same transaction, which may lead to further discounts. In addition, websites like Realtor.com, Zillow, and others will display buyer broker compensation, thus allowing buyers to compare rates.
However, it’s important to note that commission rates are not set in stone. They can vary widely and many brokers already negotiate their fees. The changes instituted by the settlement should make it easier for consumers to understand and potentially negotiate these costs.
Home buyers to be spared broker commissions up to 6% under Realtor group settlement
The National Association of Realtors (NAR), in a recent settlement, has agreed to make changes that could potentially save homebuyers thousands of dollars in broker commissions. The changes are a result of an antitrust lawsuit charging NAR with collusion to overcharge home sellers by requiring them to pay the buyer’s agents’ commission at an inflated price.
Traditionally, the seller pays the commission for both the listing agent and the buyer’s agent, often totaling up to 6% of the home’s selling price. This cost is effectively embedded in the sales price and often indirectly paid by the buyer.
While the settlement does not directly reduce commission rates, it mandates changes providing more transparency to consumers. Under the accord, real estate agents will have to disclose commission rates to buyers before they show homes, so buyers could potentially negotiate lower fees.
Moreover, the regulations will also allow brokers to represent both buyers and sellers in the same transaction, which may lead to further discounts. In addition, websites like Realtor.com, Zillow, and others will display buyer broker compensation, thus allowing buyers to compare rates.
However, it’s important to note that commission rates are not set in stone. They can vary widely and many brokers already negotiate their fees. The changes instituted by the settlement should make it easier for consumers to understand and potentially negotiate these costs.
