$418 Million Settlement By NAR Expected To Reform U.S. Real Estate Market

The National Association of Realtors (NAR) has announced a groundbreaking $418 million settlement that is poised to bring significant reforms to the US real estate market, potentially leading to lower costs for homebuyers.

Under the settlement, the standard 6% commission model will be eliminated, with sellers no longer required to provide compensation proposals to buyers and their agents upfront. I Photo: Elvert Barnes Flickr

The settlement, which follows intense scrutiny of the NAR's practices, aims to address concerns about collusion and artificially inflated real estate fees, Christine Romans and Rob Wile reported for NBC News.

Under the settlement, the standard 6% commission model will be eliminated, with sellers no longer required to provide compensation proposals to buyers and their agents upfront.

Additionally, homebuyers will be required to sign explicit agreements with brokers before working with them, a change that may lead some buyers to forego using brokers entirely.

These reforms, expected to take effect within months of court approval, represent a significant shift in the real estate industry and could reshape how transactions are conducted.

Critics have long argued that the existing practices favored brokers and led to higher costs for consumers, and the settlement is seen as a step towards greater transparency and competition in the market.

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