NAR Settlement Impact on Home Buyers and Sellers in 2024

Nar Settlement Impact Home Buyers Sellers 2024

I'm Billy Sutton, your trusted real estate expert in Kent County, Maryland. Today, I want to discuss the settlement agreement reached by the National Association of REALTORS® (NAR) and what it means for home buyers and sellers. This settlement is big news in the real estate industry and is set to take effect on August 17, 2024. Let's dive into the details.

Understanding the NAR Settlement

On March 15, NAR reached a settlement agreement with plaintiffs to end litigation regarding broker commissions. This settlement brings several changes to how we conduct transactions, particularly concerning written agreements between buyers and their real estate agents.

Key Changes for Real Estate Transactions

Written Agreements: If you're looking to buy a home and your agent lists properties on a Multiple Listing Service (MLS)—a local marketplace for real estate professionals—you will now need to sign a written agreement with your agent before touring homes. Here's what these agreements will include:

Disclosure of Compensation: A clear and specific disclosure of the amount or rate of compensation your agent will receive or how this amount will be determined.
Objective Compensation: Compensation must be specific and objective (e.g., a flat fee, a percentage, an hourly rate) and not open-ended.
Compensation Limitations: The agreement will prohibit your agent from receiving compensation from any source that exceeds the agreed-upon amount or rate.
Negotiability Statement: A clear statement that broker fees and real estate commissions are fully negotiable and not set by law.

Changes to Compensation Communication

There are also updates on how offers of compensation are communicated due to this settlement agreement. These offers will no longer be listed on MLS platforms. However, sellers can still offer compensation off the MLS and provide buyer concessions on the MLS, such as covering buyer closing costs.

What This Means for You

As a Home Buyer:

Written Agreements: You will need to sign a written buyer agreement with your agent before touring homes, whether in-person or virtually. This ensures you understand the services provided and the compensation involved.
Open Houses: No written agreement is needed if you're just speaking to an agent at an open house or inquiring about their services.
Negotiability: Agent compensation is fully negotiable, so feel free to discuss this with your agent. As a Home Seller
Communication of Offers: Offers of compensation won't be listed on the MLS, but you can still make these offers off the MLS and provide buyer concessions on the MLS.

Real Estate Assistance in Kent County

The updates from the NAR settlement agreement are designed to bring more transparency and fairness to real estate laws and transactions, benefiting both buyers and sellers. When finding an agent to work with, ask questions about their services, compensation, and the new written agreements to make informed decisions.

As your trusted real estate agent and advisor, I'm here to help you navigate these changes and ensure a smooth and positive experience in your real estate transactions. Feel free to reach out if you have any questions or need further clarification.

Billy Sutton

Billy Sutton is a dynamic real estate professional at Coldwell Banker Chesapeake Real Estate in Chestertown, Maryland. With a deep-seated understanding of the local market, Billy has carved a niche in Kent and Queen Anne's counties, known for his exceptional negotiating skills, innovative marketing strategies, and problem-solving abilities. His expertise spans a wide range of properties, including residential homes, waterfront properties, and farmlands. Holding a Bachelor's degree in Agriculture, Billy brings a unique perspective to the agricultural real estate market. Outside of his professional life, he is an avid sports enthusiast and enjoys outdoor activities. His deep roots in the community and commitment to his clients make him a reliable and trusted advisor in the real estate sector.

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Get In Touch

Whether you’re selling or buying a home for the first time or the tenth time, we’re here to help the process go as smoothly and quickly as possible. Just let us know your Chestertown real estate goals and we’ll make them happen.

We’d be happy to discuss your estate for sale and answer any questions you may have about buying or selling homes in Maryland. Drop us a line or fill out the contact form today – we look forward to getting to know you!