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(Prices and inventory current as of Nov 30, 1999)

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Direct Access To All Multiple
Listings Like Realtors®

(Prices and inventory current as of Nov 30, 1999)

See Pictures and updates (icon)See photos and updates from listings directly in your feed

Share with you friends (icon)Share your favorite listings with friends and family

Save your search (icon)Save your search and get new listings directly in your mailbox before everybody else

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No More Buyer Agent Commissions?

No More Buyer Agent Commissions?

Over the last several months I’ve consistently been getting questions about how real estate commissions, specifically buyer agent commissions, work post-settlement.

For those of you who may not be aware: As of August 17, 2024, several practice changes were implemented following NAR’s settlement agreement, resolving claims brought by home sellers related to broker compensation.

Consumers can broadly think about the changes in two categories: 

  • First, written buyer agreements are now required and must meet specific criteria. Buyers and their agents must now reach a written agreement regarding how the agent will be compensated for their services before touring a home. More details on those agreements are below.
  • Second, offers of compensation (when a seller or a seller’s agent shares compensation with a buyer’s agent) can no longer be advertised on the Multiple Listing Services (MLS).  Offers of compensation are still an option but must be communicated off-MLS if a seller chooses to make an offer available.

For Home Sellers:

Compensation for your agent remains fully negotiable and is not set by law, and you can still offer compensation to buyer agents. You may consider doing this to market your home or make your listing more attractive to agents that have buyers.

Your agent must disclose to you and obtain your approval for any payment or offer of payment that a listing agent will make to another agent acting for buyers.  This disclosure must be made to you in writing before any payment or agreement to pay another agent acting for buyers and must specify the payment amount or rate.

If you choose to offer compensation, there are changes to how it can be communicated—your agent cannot include it on an *MLS, but can advertise compensation offers on off-MLS platforms such as social media, flyers, and websites.

*Sellers can still offer buyer concessions on an MLS (for example, concessions for buyer closing costs).

For Home Buyers:

The new practice changes require signing an agreement with your agent before touring a home.

Before signing this agreement, you should ensure it reflects the terms you have negotiated with your agent and that you understand exactly what services will be provided and for how much.

The buyer agreement must include four components concerning compensation:

  1. A specific and conspicuous disclosure of the amount or rate of compensation the agent will receive or how this amount will be determined.
  2. Compensation that is objective (e.g., $0, X flat fee, X percent, X hourly rate)—and not open-ended (e.g., cannot be “buyer broker compensation shall be whatever the amount the seller is offering to the buyer”).
  3. A term that prohibits the agent from receiving compensation for brokerage services from any source that exceeds the amount or rate agreed to in the agreement with the buyer; and,
  4. A conspicuous statement that agent fees and commissions are fully negotiable and not set by law.

In Summary

What’s important to know is these practice changes provide consumers on both sides of a residential transaction with additional choice and transparency and that compensation remains fully negotiable and is not set by law.

When finding an agent to work with, ask questions about compensation and understand what services you are receiving.

You can learn additional information on the NAR website.