National Association of Realtors and some big RE Firms like Keller Williams, REMAX, X, and Anywhere Real Estate (the parent of Coldwell Banker, Century 21, Sotheby’s International Realty, and Corcoran)were sued because NAR and these RE Firms are forcing home sellers to pay an inflated commission that is then split between their agent and the buyer’s agent. The home sellers (plaintiffs) argued commission sharing as a condition for access to the Multiple Listing Service was unfair and kept commissions artificially high.
Typically, when a home goes on the market for sale, the seller offers their broker a set commission. For decades, the commission has consistently been around 6% of the sale price, usually with a 3% split for the buyer’s and seller’s agent.
In a competitive market, the home sellers argue, the cost of the buyer’s agent’s commission would be paid not by the seller, but by the buyer who received the service. The sellers said that the buyers should be able to negotiate the fee with their agent and that the sellers should not be on the hook for paying it.
Impact of commissions on buyers and sellers
Not much is expected to change in the near term about how commissions are set, agents say, although some states already have separated the commission. Florida is not there yet, but if this continues, it will affect all states.
The longer-term impact of the verdict may be that the pairing of the buyer’s agent commission and seller’s agent commission will eventually be separated.
How will this impact you?
There are buyers who aren’t going to know the steps to buy a home if they choose not to have an agent. You will have the added cost of the buyer’s commission along with a down payment, closing costs, appraisals, and inspections.
If you choose to use the seller’s agent, that agent will not be able to represent you and walk you through your options since most lawsuits consist of transactions with dual agents or transaction brokers.
I will continue to research and post new information when becomes available to keep my potential buyers informed at all times.