The real estate industry underwent major changes in August 2024 following the National Association of Realtors® (NAR) antitrust settlement. Now that these policies have taken effect, we're beginning to see their impact on the market, homebuyers, and sellers. Here’s what’s changed, how the market has responded, and what you need to know moving forward.
Recap: What Was the NAR Settlement About?
In March 2024, the National Association of Realtors (NAR) agreed to a $418 million settlement in response to a nationwide antitrust lawsuit. The lawsuit accused Realtors® of inflating commission rates due to a lack of transparency in buyer’s agent compensation.
The settlement introduced two major changes that took effect in August 2024:
- Buyer’s agent commission can no longer be advertised on any MLS.
- Buyer’s agency agreements are now required before working with an agent.
These changes were designed to create more transparency, ensure homebuyers understand agent compensation, and encourage more direct negotiations between buyers, sellers, and their agents.
What’s Changed Since August?
1. Buyer’s Agent Compensation Is No Longer Advertised on MLS
Previously, seller-offered compensation to a buyer’s agent was visible on REALTOR®-owned Multiple Listing Services (MLS). As of August 2024, that information can no longer be publicly displayed.
Impact on the Market So Far:
- Less clarity for buyers upfront. Without visible commission offers, buyers must now proactively discuss compensation with their agent before making an offer.
- More sellers opting out of paying buyer’s agent commissions. Some sellers, especially in competitive markets, are choosing not to offer buyer's agent compensation, placing the responsibility on buyers.
- Shifts in how buyer’s agents are compensated. Agents are structuring their agreements differently, with some charging buyers upfront or requiring a minimum commission, which buyers may need to finance or pay out of pocket.
What Buyers Need to Do Now:
- Ask about commission upfront – Understand who is paying your agent before beginning your home search.
- Negotiate with sellers – Some buyers are now requesting seller credits to help cover agent fees.
What Sellers Need to Consider:
- While sellers are no longer required to offer compensation (in fact, they were never required to), homes that do offer competitive commissions to buyer’s agents may attract more qualified buyers.
2. Buyer’s Agency Agreements Are Now Mandatory
Buyers can no longer casually work with an agent without signing an agreement. Before an agent can provide services—such as showings or negotiations—a signed buyer’s agency agreement is required. Heck, one needs to be in place to go into an open house too!
Impact on the Market So Far:
- More informed buyers – These agreements make buyers more aware of their agent’s role and compensation, reducing confusion later in the transaction.
- Stronger agent-client relationships – With formal agreements in place, agents are focusing on serious buyers who understand their value and commitment.
- More upfront negotiations – Buyers and agents are discussing compensation earlier, leading to more transparent expectations in transactions.
What Buyers Need to Do Now:
- Be ready to sign a buyer’s agency agreement before working with an agent.
- Understand the terms. Read through compensation details and discuss any concerns before signing.
What Sellers Need to Know:
- Buyers working under an agreement may be more committed and financially prepared, leading to smoother transactions.
How the Market Has Responded So Far
For Homebuyers:
- More out-of-pocket costs. Some buyers are now paying agent commissions directly, rather than relying on seller-offered compensation.
- Stronger negotiations. Buyers are negotiating commission credits in their offers to offset agent fees.
- More competition for homes where sellers offer compensation. Properties where sellers still offer buyer’s agent commissions are attracting higher interest from buyers looking to minimize costs.
For Home Sellers:
- Some sellers no longer offering buyer’s agent commission. This can lead to fewer buyer inquiries, longer days on market, or price negotiations.
- Others offering commission strategically. Sellers in less competitive areas are still offering buyer’s agent compensation to make their listing more attractive.
- Increased reliance on seller concessions. Instead of offering direct compensation, some sellers are now providing closing cost credits to buyers.
Key Takeaways
- Buyers must now sign an agency agreement before working with an agent or touring homes (including open houses).
- MLS no longer displays buyer’s agent commissions, so buyers must proactively discuss compensation.
- Sellers have more flexibility in whether to offer buyer’s agent compensation—but those who do may attract more buyers.
- Buyers and sellers should be prepared to negotiate commission and closing cost credits more than before.
The real estate landscape has shifted significantly since these changes took effect, and the way homes are bought and sold continues to evolve. Whether you’re buying or selling, working with an experienced agent who understands these new dynamics is more important than ever.
If you have questions about how these changes affect you, I’d love to help. Let’s connect!
