Realtor settlement on commission-fixing could create seismic changes in how Americans buy homes

[BumRushDaShow]

Source: CNN Business

Updated 10:17 AM EDT, Fri March 15, 2024


Washington, DC CNN — The 6% commission, a standard in home purchase transactions, is no more.

In a sweeping move expected to reduce the cost of buying and selling a home, the National Association of Realtors announced Friday a settlement with groups of homesellers of landmark antitrust lawsuits by agreeing to pay $418 million in damages and eliminating rules on commissions.

“NAR has worked hard for years to resolve this litigation in a manner that benefits our members and American consumers,” said Nykia Wright, interim CEO of NAR, in a statement. “It has always been our goal to preserve consumer choice and protect our members to the greatest extent possible. This settlement achieves both of those goals.”

In November, a federal jury in Missouri found the NAR and two brokerages liable for $1.8 billion in damages for conspiring to keep agent commissions artificially high. The NAR had pledged to appeal the case, but other brokerages settled — and, eventually, so did the NAR on Friday.

Read more: https://www.cnn.com/2024/03/15/economy/nar-realtor-commissions-settlement/index.html

[AllaN01Bear]

1. of course , greed strikse again.

[Bayard]

2. I don't think 6% is that much,

Especially when it may be split between 2 realtors.

Other professions make way more. For instance, before I retired from the executive recruiting biz, our typical fee schedule was 25% of the first year salary. In the 90's, when everything was going gangbusters (thank you Pres. Clinton!), we were getting 30%. I never went below 20%. But again, that was often split 2 ways between 2 recruiters.

[tom_kelly]

3. When you're dealing with a corporation that may sound fair

But I think 6% is quite much for an individual to absorb, especially for the amount of work put forth by a realtor.

[twodogsbarking]

4. I have sold two houses without realtors. More people should. Six percent is way too high.

[Merlot]

6. The amount of work real estate agents do has changed due to the internet

Now people do their own searches and setting up appointments for showings. It's not like back when only agents had access to listings.

I worked as a buyer with one agent who did earn her fee, but as a seller I had to choose to go through redfin due to them offering a 1.5 listing fee, where as most agents still wanted 2.5 or 3%. While I can see some justification for the buyers agent, the listing agents should be lower.

It will be interesting to see how this plays out. I"d be ok with 1% listing fee and 1.5% for buyers agents. Also would be preferable as seller not to have to pay all fees. My guess is that commission fees will go down, and then other "fees" will mysteriously appear.

[Uncle Joe]

5. The size of the average American home has gotten ridiculous

US /
HOMES
Average Size of US Homes, Decade by Decade
It's nearly tripled since 1950

By Newser Editors, Newser Staff
Posted May 29, 2016 12:17 PM CDT

Average Size of US Homes, Decade by Decade
A "sold" sign sits in front of a house under the final stages of construction in Plano, Texas. (AP Photo/LM Otero, File)
24/7 Wall St has a list that shows how the typical American home has changed from 1920 to 2014. And that mainly means the homes have gotten way bigger. The list tracks various stats year by year, including average square feet. Here's a sample, with the figure referring to the average floor area of a new single-family home:
1920: 1,048 square feet
1930: 1,129
1940: 1,177
1950: 983
1960: 1,289
1970: 1,500
1980: 1,740
1990: 2,080
2000: 2,266
2010: 2,392
2014: 2,657
Click for the full list. (More homes stories.)

https://www.newser.com/story/225645/average-size-of-us-homes-decade-by-decade.html



Meanwhile the average U.S. family size has gotten smaller over the same period of time from 3.67 to 3.13 from 1960-2021

https://www.statista.com/statistics/183657/average-size-of-a-family-in-the-us/

The Earth is only so large with limited resources if fewer and fewer people keep buying ever bigger homes, the push on construction costs/resources and labor alone will drive up the price of real estate as well as pricing an ever increasing number of Americans out of the market.

Thanks for the thread BumRushDaShow