The recent settlement involving the National Association of Realtors® (NAR) marks a significant turning point in the real estate industry. New regulations have been introduced that will reshape how real estate is bought and sold across the United States. The settlement was reached after a series of antitrust lawsuits. It is set to bring about critical changes in disclosures, agency agreements, MLS advertising, and other procedures relating to real estate transactions.
Transparency in Disclosures
One of the most substantial changes from the settlement is the heightened emphasis on transparency in disclosures. Moving forward, real estate agents and brokers will be required to clearly disclose the commissions being paid to both the buyer’s and seller’s agents. This new regulation aims to eliminate confusion and ensure that all parties involved in a transaction fully understand the financial dynamics at play. Buyers, in particular, will now have better insight into how their agent is compensated.
Overhaul of Agency Agreements
Agency agreements will also undergo significant changes. The settlement mandates that these agreements must be more explicit about the duties and obligations of real estate agents toward their clients. This includes clearer language about fiduciary responsibilities, the scope of representation and any potential conflicts of interest. For buyers and sellers, this means a higher level of protection and a more straightforward understanding of their relationship with their real estate agent.
Changes in MLS Advertising
The way properties are advertised on the Multiple Listing Service (MLS) will see a considerable shift as well. The settlement prohibits certain practices that were previously commonplace, such as advertising a property as “co-listed” with another brokerage without proper disclosure of the compensation arrangement. Additionally, agents will no longer be able to advertise any offer of commission the seller is willing to pay to the buyer’s broker. This change is expected to lead to a more open and competitive environment, benefiting both buyers and sellers.
Commission Structures
One of the most significant implications of this settlement is how Realtor® commissions will be disclosed and structured, especially those paid to buyer’s agents and brokers. Traditionally, the seller’s agent would offer a portion of their commission to the buyer’s agent—often without the buyer’s full awareness of the amount. The new transparency laws will provide home buyers and sellers more clarity when it comes to how commissions are being paid to the real estate agents and brokers representing each side of the transaction.
The coming months represent a time of change in the real estate industry. At The Durkovic Group, we are no strangers to changing regulations and practices. The market is always evolving and today’s buyers and sellers are more savvy than ever. We will continue to adapt and evolve along with the industry to best serve our customers.
If you are buying or selling a home in Pasadena, La Cañada Flintridge or the surrounding San Gabriel Valleys, contact The Durkovic Group today.
