Antitrust ruling expected to reshape US real estate market in 2023

As the real estate market in the United States faces a potential shift in 2023, many are closely watching the outcome of a landmark antitrust ruling against the National Association of Realtors (NAR). This ruling could have a significant impact on the way homes are bought and sold in the country.

Home purchases in 2023 hit a 30-year low, largely due to rising mortgage rates and soaring home prices. However, the $418 million settlement reached in the antitrust case against NAR could lead to a significant change in the market. The agreement would eliminate the hefty commissions typically collected by real estate brokers, which can amount to up to 6% of the purchase price.

This ruling is expected to benefit home sellers, who have long argued that NAR’s rules unfairly inflated agent commissions. By allowing buyers and sellers to negotiate lower commissions, the new regulations could potentially lead to a drop in housing prices.

Currently, the average price of a home in the US is $387,000, with a 6% commission equating to about $23,000. By reducing these commissions, experts predict that sales prices could also decrease, making homes more affordable for buyers. Projections suggest that commissions could be reduced by 25% to 50%.

However, there are concerns that reducing commissions could lead to buyers having to pay this extra percentage directly to their agents, rather than having it rolled into their mortgage. This means that buyers may no longer be able to defer this payment, potentially affecting their overall affordability.

As the real estate market braces for potential changes, it is clear that the outcome of this antitrust ruling could have far-reaching implications for buyers, sellers, and agents alike. Stay tuned for more updates on how this ruling will impact the US real estate market in the coming months.