One Year Later: How the NAR Settlement Is Reshaping Real Estate in 2025

One Year Later: How the NAR Settlement Is Reshaping Real Estate in 2025

In March 2024, the National Association of Realtors (NAR) reached a landmark $418 million settlement to resolve antitrust lawsuits alleging that its commission practices inflated costs for homebuyers and sellers. The settlement, effective August 17, 2024, introduced significant changes to real estate transactions, particularly concerning agent compensation and buyer representation. Now, nearly a year later, the industry is experiencing notable shifts in buyer behavior, seller strategies, and the rise of alternative brokerage models.

For earlier coverage on the NAR settlement see here

🧾 Buyers Are Negotiating More—and Earlier

Under the new rules, buyers must sign a written agreement with their agent before touring homes, clearly outlining the agent's compensation. This requirement has prompted buyers to engage in upfront discussions about fees and services, leading to more personalized and negotiated agreements. (Yahoo Finance)

While the average buyer's agent commission has only slightly decreased—from 2.45% to 2.37% in Q4 2024—there's a growing trend of buyers seeking more control over their agent relationships. Some are opting for flat-fee services or negotiating reduced commissions, especially in competitive markets. This shift empowers buyers to tailor their agent services to their specific needs and budgets. (The MortgagePoint)

🤝 Sellers Still Offering Cooperative Compensation

Despite the settlement's prohibition on listing buyer-agent commissions in MLS listings, many sellers continue to offer cooperative compensation to attract buyers. These offers are now communicated through alternative channels, such as brokerage websites or direct negotiations. (Business Insider)

According to Redfin, about half of surveyed agents reported that commission structures in their regions have remained relatively constant since the settlement. Sellers recognize that offering buyer-agent commissions can make their properties more appealing, especially to buyers who might otherwise be deterred by additional out-of-pocket expenses. (Redfin)

💼 Flat-Fee Brokerages Gain Traction

The evolving landscape has paved the way for alternative brokerage models, particularly flat-fee services that offer cost-effective solutions for buyers and sellers. Startups like TurboHome are gaining popularity by providing transparent pricing structures and customizable services. (Business Insider)

An example of this change is TurboHome who operates by paying local agents salaries instead of commissions and offers buyers refunds through flat-fee representation. These models appeal to consumers seeking flexibility and clarity in their real estate transactions. (Business Insider)

🔮 Looking Ahead

As the real estate industry continues to adapt to the post-settlement environment, consumers are benefiting from increased transparency and flexibility. Buyers are more informed and proactive in negotiating agent relationships, while sellers are exploring various strategies to market their properties effectively.

The rise of alternative brokerage models signifies a shift toward more consumer-centric approaches in real estate. As these trends continue, buyers and sellers alike can expect a more personalized and cost-conscious experience in their real estate endeavors.

For more insights into navigating the evolving real estate landscape, visit TurboHome.com.