Lisa Mailhot | June 7, 2024
Buyers
Recent developments from the National Association of Realtors (NAR) suggest a pivotal shift in real estate practices. With a new proposed settlement potentially ending the practice of steering, the landscape of real estate transactions is set for a significant transformation. This blog delves into the details of the settlement, its implications for real estate professionals, and what it means for the market as a whole.
The NAR’s proposed settlement addresses the longstanding issue of steering—where buyer agents influence client choices based on commission rates offered by listing agents. This practice has been a point of contention, leading to several antitrust lawsuits. The settlement not only seeks to make compensation offers from listing brokers to buyer brokers "irrelevant" but also mandates that these offers should not be made through multiple listing services (MLS).
Michael Ketchmark, the lead plaintiffs’ counsel in a major lawsuit resolved by this settlement, emphasized the legal gravity of steering and the commitment to enforce the new rules vigorously. With the Department of Justice (DOJ) keeping a close watch, the real estate industry is under scrutiny to adhere strictly to these new guidelines, which are pending final approval.
In response to the settlement, NAR has updated its FAQ section to clarify these changes. From August 17, 2024, buyer brokers must enter into written agreements with buyers, stipulating the compensation they will receive, which cannot exceed the agreed amount. This move aims to discourage brokers from steering clients towards properties offering higher commissions, thereby fostering a fairer, more transparent marketplace.
Despite the settlement, NAR continues to support the idea of cooperative compensation, where listing brokers can still advertise compensation offers to buyer brokers through various non-MLS channels. This ongoing support highlights the complexities of transitioning to the new system and the balance NAR seeks to maintain within the industry.
As the real estate landscape evolves, understanding these changes becomes crucial for anyone involved in buying or selling property. If you're considering a move and want expert guidance tailored to these new realities, let's connect.
Explore essential long-term investment strategies that guarantee sustained wealth growth. Read a blend of expert advice, practical tips, and visual insights to guide b… Read more
Explore the surprising strength of the luxury real estate market amidst challenging economic conditions. Learn why wealthy buyers remain unfazed by high mortgage rates… Read more
Discover how strategic budget management can eliminate stress and transform your organization's financial planning. Learn key insights on setting goals, collaborating … Read more
Explore how Silicon Valley billionaires' ambitious plan for a new California city impacts real estate trends. Learn valuable insights for Orange County homebuyers and … Read more
Explore the reasons behind the significant decline in U.S. home sales to foreign buyers, including economic factors and market trends. Learn about the changing dynamic… Read more
Discover the benefits and drawbacks of Home Equity Agreements (HEAs) compared to HELOCs and Home Equity Loans. Learn how HEAs can provide flexible financial solutions … Read more
Discover how new federal regulations for automated valuation models change the mortgage landscape. Learn about the quality control standards, anti-discrimination measu… Read more
Discover expert strategies to enhance your home’s appraisal value with our latest blog. We delve into crucial advice from real estate professionals to navigate apprais… Read more
Discover how San Pablo transformed an abandoned office building into a 54-unit housing complex for the homeless. Learn about this groundbreaking project's challenges, … Read more
Let's find a time that suits you best to chat about your goals, show you how we work, and figure out how we can help you the most