Home sellers can say goodbye to hefty 6% commissions under new real estate deal
As part of an agreement to settle a series of lawsuits over inflated real estate commissions, the National Association of Realtors said Friday that big changes are on the way.
The group says it will pay more than $418 million to settle the lawsuits. But much more significantly, industry experts say, the settlement will upend the real estate market and create more competition, which will lead to lower commissions.
The realtor group said it will eliminate a longstanding rule that mandated a non-negotiable commission be posted on the Multiple Listing Service (MLS), its real estate database, which handles more than 90% of home sales. Currently, to list a home with MLS, the non-negotiable commission is typically between 5 and 6 percent.
By removing that rule, real estate commissions can be negotiated, which could lead to lower costs for home sellers.
Asked for comment, the National Association of Realtors referred NJ Advance Media to its statement.
“This would mean that offers of broker compensation could not be communicated via the MLS, but they could continue to be an option consumers can pursue off-MLS through negotiation and consultation with real estate professionals,” said Nykia Wright, the group’s interim CEO, in the statement.