The real estate landscape has just undergone a seismic shift, and it’s one that could save future home buyers and sellers thousands of dollars. The National Association of Realtors (NAR), representing over a million real estate professionals, has agreed to a landmark settlement that will change how commissions are structured, potentially ending the traditional 6% fee that has long been a standard in home transactions. This change comes as part of a settlement agreement to end antitrust lawsuits, with the NAR agreeing to pay $418 million in damages and implement new rules that will dramatically alter the business model of buying and selling homes.

Key Changes from the Settlement

  1. Elimination of Mandatory Commission Fees: Previously, sellers were responsible for paying the commission of both their broker and the buyer’s broker, which often drove up the cost of housing. This settlement removes the obligation to pay these commissions, which could lead to significant reductions in overall real estate transaction costs.
  • New Rules for Real Estate Agents: Agents’ compensation will no longer be included in listings on multiple listing services (MLS), a practice that critics argue pushed brokers towards more expensive properties. Additionally, brokers will no longer be required to subscribe to multiple MLS, potentially increasing competition and transparency in the market.
  • Impact on Real Estate Commissions: Analysts from TD Cowen Insights estimate that real estate commissions could fall by 25% to 50%. This reduction opens the door for alternative, more affordable models of selling real estate to gain traction.

What This Means for Home Buyers and Sellers

  • Lower Costs: For a median-priced American home, the traditional brokerage fees could have amounted to more than $25,000. With the new settlement, these costs could be reduced significantly, potentially saving both buyers and sellers thousands of dollars.
  • Increased Competition: Real estate agents may now compete on commission rates, which could lead to more affordable options for consumers. This competitive landscape might also encourage more transparent and fair pricing in the real estate market.
  • A Shift in the Market: As the real estate market adjusts to these changes, we might see a shift in how homes are bought and sold. This could include a rise in flat-fee and discount brokerages or innovative new models that offer more flexibility and cost-effectiveness.

Expert Insights: The Future of Real Estate Transactions

Julian Doby, a renowned Southport, NC Attorney with extensive experience in real estate law, emphasizes the importance of understanding these changes and how they can benefit consumers. “This settlement represents a significant victory for competition and transparency in the real estate market,” Doby notes. “However, navigating the new landscape will require careful consideration and possibly legal consultation to ensure that buyers and sellers fully benefit from these changes.”

Doby also highlights the potential for legal complexities as the market adapts, suggesting that consulting with a legal professional can help individuals make informed decisions and protect their interests in this evolving landscape.


The settlement and the resulting changes in the real estate commission structure mark a pivotal moment for the industry. As the dust settles, the implications for consumers could be profound, offering more affordability and choice in how people buy and sell homes. As we move forward, it’s clear that the real estate market will never be the same again, and that could be very good news for consumers across the country.

Disclaimer: This article is for informational purposes only and does not constitute legal advice. The legal landscape is subject to change, and it’s important to consult with a professional for advice tailored to your situation.