Homeowners to Save on Commissions as Real Estate Group Settles Lawsuits

The National Association of Realtors (NAR) has agreed to slash commissions in a landmark deal that could potentially save homeowners thousands of dollars when selling their homes. The agreement comes after the organization settled lawsuits against it, agreeing to pay $418 million over four years to resolve claims related to broker commissions.

Currently, almost 9 in 10 home sales are handled by real estate agents affiliated with NAR. The organization requires home sellers to determine a commission rate, typically 6%, before listing their homes on the Multiple Listing Service (MLS). The lawsuits argued that this structure harms competition and leads to higher prices.

With the potential for fees to be slashed by up to 30%, economists predict significant savings for homeowners. Standard commission rates in the U.S. are among the highest in the world, with real estate agents typically pocketing a percentage of the home’s sale price.

While some experts believe the deal could shake up the housing market and drive down home prices, others are more skeptical. Residential brokerage analyst Steve Murray believes that lower commission costs for sellers could save money for sellers but might not have a significant impact on home prices.

Overall, the deal could lead to savings for homeowners when selling their properties, but the ultimate impact on the housing market remains to be seen. With mortgage rates still high, other factors like home prices and interest rates may play a larger role in homebuyers’ decisions.