National Association Of Realtors Reaches $418M Deal That Changes Compensation

The National Association of Realtors has agreed to pay $418 million to settle broker commission claims brought on behalf of home sellers.

Under the terms of the agreement, NAR continues to deny any wrongdoing in connection with the Multiple Listing Service cooperative compensation model rule. They will pay the multi-million sum over the course of approximately four years, according to a press release.

Although cooperative compensation remains a choice for consumers when buying or selling a home, NAR has agreed to put into place a new rule prohibiting offers of broker compensation on the MLS. Instead, sellers will be expected to negotiate with real estate professionals.

MLS participants working with buyers will be required to enter into written agreements with them.

These changes will go into effect in mid-July.

“This will be a time of adjustment, but the fundamentals will remain: buyers and sellers will continue to have many choices when deciding to buy or sell a home, and NAR members will continue to use their skill, care, and diligence to protect the interests of their clients,” NAR President Kevin Sears said in a statement.

The settlement is subject to court approval and resolves claims against NAR, over one million of their members, all state/territorial and local associations, all association-owned MLSs, and all brokerages with an NAR member as principal that had a residential transaction volume in 2022 of $2 billion or below.

Agents affiliated with HomeServices of America and its related companies — the last corporate defendant still litigating the Sitzer-Burnett case — are not released under the settlement, nor are employees of the remaining corporate defendants named in the cases covered by this settlement, according to the press release.