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An appeal was filed several weeks ago in a ruling against brokers and the National Association of Realtors that awarded $1.8 billion in favor of the plaintiffs. The jury found that the NAR had artificially inflated home prices through a common practice of coupling commissions to be paid to agents. At the settlement table, the commission was decoupled with a percentage going to the seller’s agent and the remaining percentage offered to the buyer’s agent.
The case Burnett v NAR, argued successfully that the NAR forced home sellers to pay for the buyer’s representation, and that fee should be covered by the buyer directly. The ruling was delivered on October 31st through a federal jury in Missouri. The NAR has appealed the jury’s decision, claiming the trial was held outside of the district of the claims and that is where the trial took place did not have experience with NAR rules.
Home prices have been increasing for the past decade, with post-pandemic pricing continuing to trend with inflation. Interest rates have almost doubled over the past three years. The ability to purchase a home has become cost prohibitive, with most sellers requesting seller’s assistance at settlement. Buyers may soon be on the hook for also paying for proper representation out of funds not tied to their lending.
Today, I sit down with Ryan Zinn, an associate broker with over 20 years of experience in real estate. She is licensed in Pennsylvania and Delaware. You will also hear from the lending side, as mortgage consultant Ben Besosa brings 17 years of experience on how this may affect purchasing power.
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