Understanding the NAR Lawsuit Settlement and its Impact on FL Real Estate

real estate agent shows home in Florida - understanding the NAR lawsuit

Recent headlines have drawn attention to the lawsuit involving the National Association of REALTORS® (NAR) and its proposed settlement. If you’re considering a career in real estate, you might be curious about how these developments could impact your future success in the field. We recognize your concern – there’s a lot to digest. Here’s a concise overview of the court case and settlement for those interested in pursuing a career as a real estate agent.

Please note: Gold Coast Schools will be covering updates on this ongoing situation through a series of blogs. For a comprehensive analysis of the proposed NAR settlement and its implications for the industry, turn to Gold Coast Schools.

Related content: Learn more about the NAR lawsuit and settlement by listening to this insightful webinar.

Key Takeaways

  • Recent headlines about the NAR lawsuit and proposed settlement have sparked interest among those considering a career in real estate, raising questions about potential impacts on future success in the industry.
  • The lawsuit, Burnett v. NAR, found the NAR and some brokerages liable for inflating buyer agent commission fees, focusing on practices related to advertising commissions via MLS that critics argue could influence agent priorities.
  • The proposed settlement, expected to take effect in July 2024 pending court approval, aims to enhance transparency in real estate transactions by requiring written buyer agreements outlining agent compensation, potentially reshaping how services are provided in the market.

The NAR Lawsuit: Burnett v. NAR, et al. Verdict

On October 31, 2023, a federal jury in the U.S. District Court for the Western District of Missouri found the NAR and certain brokerages liable for artificially inflating buyer agent commission fees.

The lawsuit focused on the practice where seller agents advertise specific commissions to buyer agents via Multiple Listing Services (MLS). Critics argue this practice incentivizes buyer agents to prioritize properties offering higher commissions.

In response, NAR stated, “NAR does not dictate commissions, which have been negotiable long before this settlement and will remain negotiable between brokers and their clients.”

Proposed Settlement of the NAR Lawsuit

In March 2024, NAR and plaintiffs reached a proposed settlement to resolve claims regarding broker commissions on behalf of home sellers. Pending court approval, this settlement is slated to take effect on July 1, 2024.

Under the proposed terms, REALTOR® members serving as buyer agents will need to enter into written agreements with buyers before providing services such as property showings or submitting offers. Compensation for buyer agents will be clearly outlined in these agreements, potentially based on a percentage of the sale or a fixed rate.

Impact of the Proposed NAR Lawsuit Settlement

Apart from improving transparency surrounding commissions and fees, the settlement could introduce additional changes that offer consumers more choices and foster a fairer real estate market. To understand these shifts and their implications for new real estate agents, subscribe to the Gold Coast Schools blog.

Despite these developments, one constant requirement for aspiring agents is obtaining a Florida-specific real estate license. Begin your journey toward meeting these requirements by consulting with Gold Coast Schools today.