Greater Boston Real Estate Board’s Post

The business practice changes outlined in the National Association of REALTORS® (NAR) commission lawsuit settlement agreement,will go into effect on Aug. 17, 2024, according to a letter sent to members on Friday by NAR chief legal officer Katie Johnson. Originally, the trade group had said the practice changes would go into effect in mid-July. In the letter, Johnson noted that NAR’s settlement agreement requires that practice changes are implemented no later than the date of the class notice. Per the preliminary settlement approval process, Aug. 17 is the earliest known date that the class notice could be sent out. Multiple listing services that opted into the agreement have until Sept. 16, 2024, to implement policy changes and be considered as released parties, although Johnson and NAR recommend that all of the MLSs that choose to opt in should implement them by Aug. 17. Johnson’s letter also outlined what these changes will look like and what revisions to NAR’s MLS policy handbook have been made. The changes include eliminating and prohibiting “requirement of offers of compensation in the MLS between listing brokers or sellers to buyer brokers or other buyer representatives,” as well as prohibiting “MLS Participants, Subscribers, and sellers from making any offers of compensation in the MLS to buyer brokers or other buyer representatives.” #NAR #RealEstateNews #RealEstateAgent #MortgageNews #LoanOffice #HomePurchase #HomeSale #MortgageBroker

NAR’s commission lawsuit settlement receives final approval The National Association of Realtors (NAR) and the real estate industry at large have something to be thankful for this Thanksgiving. Judge Stephen Bough of the U.S. District Court in Kansas City, Missouri, on Tuesday granted final approval to NAR’s commission lawsuit settlement agreement, as well as the settlements reached by HomeServices of America and the numerous MLSs and brokerages that chose to opt into NAR’s settlement.   The approval comes despite a last-minute filing from the Department of Justice, in which the DOJ took issue with the settlement provision that requires buyers to sign a buyer broker representation agreement prior to touring a house with an agent. The DOJ believes the buyer broker agreements have the potential to “limit how brokers compete for clients.” More: https://lnkd.in/e3Ufi94M Here are the key points summarized in bullet form:• Judge Stephen Bough granted final approval to NAR's commission lawsuit settlement agreement on November 26, 20241 .• The settlement includes NAR, HomeServices of America, and 15 MLSs and 13 brokerages that opted in1 .• NAR will pay $418 million and agree to business practice changes, including removing offers of compensation from the MLS1 .• HomeServices of America will pay $250 million into the settlement fund1 .• The Department of Justice filed a last-minute statement expressing concerns about the settlement's requirement for buyer broker representation agreements1 .• Nearly 500,000 people have submitted claims to be part of the settlement, with eligible home sellers having until May 2025 to file a claim1 .• The settlement protects brokerages with less than $2 billion in 2022 sales volume and all Realtor-affiliated MLSs1 .• This is the third round of commission lawsuit settlements approved by Judge Bough, following earlier approvals for other major real estate companies1 .• The DOJ noted that the settlement approval does not preclude future enforcement actions by the United States1 .

BIG NEWS!!! The Plaintiffs in the Burnett case finally clarified what is permitted and what is not permitted under the NAR Settlement. It only took a 136-page objection to get them to speak up. *NOT PERMITTED* 1. Modifying a Buyer Agreement to Receive Additional Compensation 2. Collecting Seller-Paid or Builder Bonuses 3. Touring Agreements Supplemented with Brokerage Agreements 4. Ranges of Compensation (minimum up to a maximum) 5. Property Specific Compensation Agreements Entered Into After Compensation is Known. In short, all the workarounds I've identified over the past six months are not permitted. It's all here in black and white: pp. 41-44: https://lnkd.in/gh-xD2wu Additionally, cooperative compensation is permitted under the NAR Settlement. And listing agents can refuse to take a seller as a client if the client doesn't want to agree to cooperative compensation. Lots to unpack! And lots of retraining ahead!

Loan Officers - Inform your agents. We’re finally getting g meaningful clarity post NAR settlement. Read this article. Share it with your agents.

DOJ comes out against NAR commission lawsuit settlement: The DOJ claims the NAR commission lawsuit settlement’s requirement for buyer broker agreements may stifle broker competition for home buyers. https://lnkd.in/g9Ns3THw #Phoenixrealestate #Arizonahomes #AZrealestate

Judge Bough deemed the proposed NAR settlement "fair, reasonable, and adequate." The agreement requires NAR to pay $418 million into a settlement fund over four years, prohibits rules that let seller’s agents set buyer’s agent compensation, and eliminates broker compensation fields from MLSs. Additionally, it bans mandatory MLS subscriptions for agents and mandates written buyer broker agreements. Final approval hearings are scheduled for November 2024, with prior hearings for Anywhere, RE/MAX, and Keller Williams in May 2024. #RealEstate #NARSettlement #LegalUpdate #MLSChanges

I've gotten a lots of texts on this headline since it went live yesterday. So... I wanted to clarify a bit. First, I have been vocal about the positives and negatives about the NAR settlement since it was signed. It's a great deal for those who are covered and overall, it's a win. That being said, the media is always going to use headlines to grab your attention and in context to a larger discussion with Brad Inman and Leo Pareja about the settlement with NAR yesterday, I did say there were some really "stupid" things in the settlement. This statement was specifically in regards to the ability for agents to still share commissions with one another. Why I think it's "stupid" to still allow this practice is because we just lost a major antitrust suit based upon sharing of commissions (sellers agent collecting and sharing with the buyers agent) and an alleged conspiracy to inflate those commissions. While there was no conspiracy and we all know it, if we continue to do the same practice that got us into this mess to begin with, the lawyers will come up with another way to claim the same conspiracy and violations of the sherman act, and take everyone back to court. It will end up in settlement again and everyone paying more money, only this time, we'll stop the practice. There is ZERO reason to share commissions any further. The seller can pay the buyers agent directly through the purchase agreement, or offer concessions to the buyer for "closing costs". The buyer can then do what they want with those concessions. Remove the sharing of commissions and you remove the chance of further legal claims around the practice. It's only logical.

Proposed Burnett et al v NAR Antitrust Settlement dated March 15, 2024... There is a lot of speculation and misinformation, often from uninformed, misinformed, or underinformed sources. But let's focus on the facts first... As Sgt Joe Friday so often stated on the popular TV Series of the 1950s, Dragnet: "All we want are the facts, ma'am." There are now more questions than answers, but we need to start somewhere: Requires a written agreement before an agent can take a buyer to view (tour) a property. (My speculation: It need not be an "Exclusive" Agreement and could be for a short period of time, or for specified properties) Eliminates and prohibits any requirement by the National Association of REALTORS®, REALTOR® MLSs, or Member Boards that listing brokers or sellers must make offers of compensation to buyer brokers or other buyer representatives (either directly or through buyers), and eliminate and prohibit any requirement that such offers, if made, must be blanket, unconditional, or unilateral. Prohibits REALTOR® MLS Participants, subscribers, other real estate brokers, other real estate agents, and their sellers from (a) making offers of compensation on the MLS to buyer brokers or other buyer representatives (either directly or through buyers) or (b) disclosing on the MLS listing broker compensation or total broker compensation (i.e., the combined compensation to both listing brokers and cooperating brokers). Requires REALTOR® MLSs to (a) eliminate all broker compensation fields on the MLS and (b) prohibit the sharing of the offers of compensation to buyer brokers or other buyer representatives described in Paragraphs 58(i) and (ii) of this Settlement Agreement via any other REALTOR® MLS field. Eliminates and prohibit any requirements conditioning participation or membership in a REALTOR® MLS on offering or accepting offers of compensation to buyer brokers or other buyer representatives. Agreement not to create, facilitate, or support any non-MLS mechanism (including by providing listing information to an internet aggregators' website for such purpose) for listing brokers or sellers to make offers of compensation to buyer brokers or other buyer representatives (either directly or through buyers), however, this provision is not violated by A REALTOR® MLS providing data or data feeds to a REALTOR®, REALTOR® MLS Participant, or third party unless the REALTOR® MLS knows those data or data feeds are being used directly or indirectly to establish or maintain a platform for offers of compensation from multiple brokers (i.e., the REALTOR® MLS cannot intentionally circumvent this requirement); or Participants may not receive compensation for brokerage services from any source that exceeds the amount or rate agreed to in the agreement with the buyer.

#complex The plot thickens, for CALIFORNIA ASSOCIATION OF REALTORS® as the #SanJose Mercury news reports that the Justice Dept launched a formal inquiry following the CFA report I mentioned a few weeks ago. I think CAR can handle it. https://lnkd.in/gqdZmTFx #update #NARsettlement. #CARvCFA #contractlaw #law #DOJ #inquiry #realestate #CAR #realtor