March 15, 2024
As you’ve undoubtedly heard, NAR announced a proposed settlement in the antitrust litigation brought by home sellers related to Broker commissions. This proposed settlement is pending final court approval.
As we take in the announcement from the National Association of REALTORS, your Association is here with you to further continue to provide products, services, and programs for our members to have the knowledge, skills, and tools to provide their expertise to their clients and customers through the most complex and ever-changing homebuying and home-selling process.
Our REALTOR members will remain at the heart of the real estate transaction and we will continue to provide resources that empower our members' success.
In the coming months we will no doubt have more information and details to better our understanding and implementation of new rules of this complex proposed settlement agreement.
As soon as more guidance is provided on implementation we will provide our members with a series of town halls and forums to keep you up-to-date and at the forefront of the anticipated changes to implement new practices to successfully serve your clients and customers.
Below is the message that was sent to all National Association of REALTORS members today from NAR President Kevin Sears.
Here you can find the fact sheet for all information regarding the proposed settlement agreement. Click here to view the fact sheet.
Here you can find the presentation on the Buyer Brokerage sessions we hosted last month at the Association with Keynote Speaker Adorna Carroll. See the PowerPoint presentation here.
Kerry Ramage, 2024 President
Space Coast Association of REALTORS
Dear all,
The Sitzer-Burnett verdict and the copycat cases filed across the country have raised questions about the way real estate professionals do their jobs and how consumers can hire and compensate us.
Since the litigation began, we have worked consistently to reach a resolution with the plaintiffs. In the months since the Sitzer-Burnett verdict, we redoubled those efforts.
We have always wanted to reduce the significant strain on our members and provide a path forward for the industry. That’s why today we announced a proposed settlement agreement that would end litigation of claims brought on behalf of home sellers related to broker commissions. The settlement is subject to court approval.
The agreement would resolve claims against NAR, over one million NAR members, all state/territorial and local REALTOR® associations, all association-owned Multiple Listing Services (MLSs), and all brokerages with an NAR member as principal that had a residential transaction volume in 2022 of $2 billion or below.
Throughout the settlement process, we engaged with a diverse range of members and considered their perspectives and interests while fighting to protect all industry players as best we could.
From the beginning of this litigation, we had two goals:
Secure a release of liability for as many of our members, associations, and MLSs as we could; and
Preserve the choices consumers have regarding real estate services and compensation.
This proposed settlement achieves both of those goals. Here are the key terms:
Release of liability: The agreement would release NAR, over one million NAR members, all state/territorial and local REALTOR® 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 from liability for the types of claims brought in these cases on behalf of home sellers related to broker commissions.
NAR fought to include all members in the release and was able to ensure more than one million members are included. Despite NAR’s efforts, 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.
Compensation offers moved off the MLS: NAR has agreed to put in place a new rule prohibiting offers of compensation on the MLS. Offers of compensation could continue to be an option consumers can pursue off-MLS through negotiation and consultation with real estate professionals. And sellers can offer buyer concessions on an MLS (for example—concessions for buyer closing costs). This change will go into effect in mid-July 2024.
Written agreements for MLS participants acting for buyers: While NAR has been advocating for the use of written agreements for years, in this settlement we have agreed to require MLS participants working with buyers to enter into written representation agreements with their buyers. This change will go into effect in mid-July 2024.
Settlement payment: NAR would pay $418 million over approximately four years. This is a substantial sum, and it will be incumbent on NAR to use our remaining resources in the most effective way possible to continue delivering on our core mission. NAR’s membership dues for 2024 will not change because of this payment.
NAR continues to deny any wrongdoing: NAR has long maintained — and we continue to believe — that cooperative compensation and NAR’s current policies are good things that benefit buyers and sellers. They promote access to property ownership, particularly for lower- and middle-income buyers who can have a difficult-enough time saving for a down payment. With this settlement, NAR is confident it and its members can still achieve all those goals.
I encourage you to watch this video from NAR Chief Legal Officer and Member Experience Officer Katie Johnson and me.
Additionally, there are materials available for members about today’s announcement at facts.realtor. You will need your NAR login credentials to access these materials. We will also continue to update competition.realtor with the latest information.
We know from our association’s 116-year history that REALTORS® are adaptable, and I’m confident that this agreement provides a path for us to move forward and continue our work to preserve, protect, and advance the right to real property for all.
Thank you for your continued dedication to consumers and to protecting property rights in America.
Regards,
Kevin