NAR Settlement Clarifications

Happy Spring! After the late snowfalls, it looks like we may be headed toward Spring-like weather which is great news!

Last week brought other news regarding the lawsuit against the National Association of Realtors (NAR). I am sure you have all read or heard that the National Association of Realtors have reached a settlement with the plaintiffs. The dissemination of this settlement through the media has come with some misinformation.

First and foremost is the idea that compensation paid to a Realtor’s brokerage by their client has never been a fixed amount. This number has always been negotiable and has never been a set amount. Typically, the seller has paid the compensation to both the listing agent’s brokerage and the buyer’s agent’s brokerage. The commission amount to both parties is a number agreed upon by the seller and the listing agent/brokerage. This settlement will decouple the commission amounts. There will be a separate commission offered to each brokerage. The Arizona Residential Listing Contract has had this separation for some time. Again, these amounts and who pays them are and always have been negotiable. 

Second, home prices will not be coming down. I read several articles implying that Realtors artificially inflate home prices to garner larger compensation. Realtors do not have that kind of influence on the real estate market. Home prices are affected by many different variables. The number one variable is simple economics: supply and demand. Location also has an impact on home prices. There are many other factors but these two have the greatest effect.  

Finally, it is important to note that this settlement still needs the approval of the court. I will do my best to keep you informed and updated as I receive more information.

One final, final thought, I want you to know that I love being a Realtor. Homeownership is one of the best ways to increase generational wealth. I am proud to be a part of this legacy for so many people. I have been and will continue to be transparent about compensation/ commissions and the value of having representation as a seller or buyer. Please reach out to me with any questions you may have. I am always honored by your referrals.

Warm regards,

Kim