What Does the National Association of Realtors Settlement Mean for Home Buyers and Sellers?
Earlier this month, the National Association of Realtors – the trade group representing the real estate industry – agreed to pay $418 million in damages to settle a series of antitrust lawsuits and eliminate its rules on commissions. A group of home sellers claimed the decades-old National Association of Realtors home sales guidelines forced sellers to pay excessive fees.
While many people are calling this a landmark settlement that could shake up the industry, others remain cautious while waiting for the dust to settle.
Newly appointed executive director of the Wilbur C. Henderson Real Estate Institute in Drexel University’s LeBow College of Business, Carter Murdoch, PhD, shared his extensive expertise as a real estate agent and executive in real estate, and what this settlement agreement will mean for different segments of the industry – from the real estate agents to home buyers and sellers.
Can you briefly describe the lawsuit?
Murdoch: The Sitzer/Burnett verdict, along with several other cases, claim antitrust violations by several of the largest real estate brokerages and the National Association of Realtors for controlling/inflating sales commissions. The primary issue is that buyer agent fees, or commissions, are published in the multiple listing service (MLS) and detailed in the listing agreement (paid for by the property seller). This has been a widespread practice since the early to mid-1990’s when “buyer’s agency” was implemented.
