These home buyers and sellers saved tens of thousands of dollars by embracing new real-estate rules

By Aarthi Swaminathan

A year after the NAR settlement upended how homes are bought and sold, some people are ditching traditional real-estate agents

“The old, traditional way is dead,” one home buyer told MarketWatch.

Having bought three homes with the help of a real-estate agent, Michelle Milburn had a fair understanding of what to expect. She decided to buy her fourth home without one, and ended up pocketing thousands of dollars in the process.

Milburn, who lives in Maryland, turned to SAVE6, a real-estate company that would help her buy a house – and give her a buyer’s rebate. In other words, the company would close the deal, write and review the contracts, and also give her up to 50% of the commission that it would receive as the buyer’s agent.

Milburn is part of a small but growing group of Americans who have become more skeptical about real-estate commissions and opted not to hire a traditional real-estate agent to buy or sell their homes. These savvy home buyers and sellers have become far more attuned to the possibilities of saving on real-estate commissions than in the past, thanks to a landmark settlement that upended the industry one year ago.

The August 2024 settlement between a group of home sellers and the National Association of Realtors, aimed at increasing transparency in home buying and selling, established new rules to address allegations of price-fixing and anticompetitive behavior by the NAR that the industry group denies.

In decades past, sellers paid a 6% commission that was split between their own listing agent and the buyer’s agent. Now, buyers and sellers are expected to negotiate and possibly pay for their own agents’ fees. Sellers can still offer to cover fees for agents on both sides of the transaction, but they are no longer obligated to do so. For regular home buyers and sellers, broker fees are now fully negotiable and not set by law.

In Milburn’s case, the seller still paid thousands of dollars to the real-estate agents, but Milburn and her buyer’s agent split their portion of the commission, pocketing $4,100 apiece.

From the archives (August 2024): How we buy homes is about to change in a big way. Here’s what you can – and can’t – do under new NAR rules.

“The practice changes have enhanced consumer choice and promoted increased transparency for home buyers and sellers alike,” the NAR told MarketWatch. “NAR and its members are committed to implementing the practice changes and continue to assist consumers through their home-buying and selling journeys.”

But some see the idea of paying a commission at all – even at a reduced rate, under the new rules – as outdated. “The old, traditional way is dead,” Milburn told MarketWatch. “Why would I go with that version when I can get half [of the commission] back at closing and get an experienced person negotiating for me?”

Commissions are steady since key NAR settlement – but buyers and sellers are testing their negotiating power

Not much has changed in the real-estate industry since the settlement, at least with commissions. In fact, industry data show that sellers are paying even more to buyers’ real-estate agents than they were before.

After a brief dip around August 2024, commissions paid to buyer’s agents are now slightly higher than when the rule took effect, according to a Redfin report.

Redfin (RKT) attributes the uptick to a significant housing-market slowdown that has tipped the scales in buyers’ favor in many parts of the U.S., prompting some sellers to pay higher commissions to buyers’ agents to close a deal, the real-estate brokerage suggested.

Even if commissions remain roughly flat, buyers and sellers have become more aware of the new rules. “Since the NAR settlement, there has been a lot more discussion about commissions with clients, and more sellers are trying to counter with a lower commission rate,” Andrew Vallejo, a Redfin real-estate agent, said in a blog post. “But in most cases, in today’s market, the buyer can stay firm.”

People are also experimenting with new ways of buying and selling homes as they become aware that real-estate fees are negotiable. A cottage industry has emerged to offer services traditionally provided by a buyer’s or seller’s agent, dangling major discounts to lure price-sensitive buyers and sellers.

“There is every indication that, for significantly reduced fees, many low-commission agents provide the same quality of service offered by successful traditional agents,” Stephen Brobeck, a senior fellow at the Consumer Policy Center, said in a recent report.

Here’s how some home buyers and sellers ditched traditional real-estate agents over the past year – and saved tens of thousands of dollars.

Embracing the new rules on commissions

When Alyse and Chris Ginter sold their home in Seattle, Wash., earlier this year, they decided to use a real-estate agent with Redfin. They paid both their listing agent and the buyer’s agent a commission.

They were relocating to San Diego, where they hired a buyer’s agent. Historically, and as the Ginters had done in Seattle, sellers covered the buyer’s agent. But the agent they hired, Kevin Kretzmer of TurboHome, offered to split his 3% commission with them since his company had a different business model. He would handle all of the paperwork and negotiations.

That choice would prove a game changer. Their dream home in San Diego was listed for $4.7 million, and the sellers weren’t willing to go lower. After months of back-and-forth, the Ginters decided to step up their offer of $4.3 million by an additional $200,000. What really closed the deal was their offer to pay for their own agent: Instead of the sellers paying Kretzmer a 3% commission, the Ginters would pay a flat fee of $15,000 to him directly, and the sellers would only pay their listing agent. This increased the sellers’ profit and won the Ginters the house.

“The seller really, really wanted $4.5 million to be what their take-home was, and they did pay their listing agent a commission, but they didn’t want to pay anything to the buyer’s agent if they were going to sell at that price,” Kretzmer said.

Because the Ginters used a flat-fee service, they were able to make that number work – even if it was a little out of their budget. Overall, the couple saved about $97,000 in fees that they would otherwise have paid a typical buyer’s agent working for a traditional brokerage, who usually charges a fee of 2% or 2.5% of a home’s final sale price.

Buyer’s rebates and flat fees

Forty-two states plus Washington, D.C., allow agents and brokers to offer a cash rebate to buyers, according to Clever – meaning a buyer’s agent can give some of that commission to their buyer.

In Virginia, which allows buyer’s rebates, homeowner Steve Busch had already decided to skip a traditional real-estate agent for his most recent purchase.

He was intrigued by the idea of a rebate, but prioritized service and responsiveness. He also wanted to pay a flat fee, rather than a traditional commission. “I’ve bought and sold homes for many years and have been on both sides,” Busch said.

Busch got what he wanted. Like Milburn, he used SAVE6, which gave him half of the buyer’s-agent fee back. (Busch declined to disclose the rebate amount.)

Saving on commissions for both buying and selling the house

Saving on the entire 6% commission can also be a game changer for some in today’s market.

Selling within a year or two of buying a home – particularly at a time when home-price appreciation has fizzled – might mean they risk losing money, as their home value may have fallen compared with when they bought the home.

Out West, Brittney Vella faced that situation – and ended up saving on both the seller’s and buyer’s-agent commissions when selling her home in Yuma, Ariz.

The former Marine, who bought her last home in January 2024 for $685,000, felt the 4,300-square-foot home was too big for her family’s needs. So she decided to list it on the market this May for $710,000. “We’ve only been there for a year and a half, so when you don’t have a lot of equity in the house, potentially paying 6% for a commission could be the difference between taking a loss and breaking even,” she said. The sale closed on July 28, per data from the multiple-listing service.

Given her experience with selling homes in the past, she decided to try Ridley, a flat-fee service that launched in mid-July, to save on the traditional 6% commission she’d have to pay. For $1,000, the company would get her on both her local and state multiple-listing services, providing her listing with maximum exposure.

Vella also did a lot of the legwork herself. With her background in real-estate marketing and certification as a drone pilot, she was able to capture her own photography and videos for the listing. Typically, these services can cost upwards of $300.

Luck helped, too.

The people who ended up buying her house found the property through her mortgage lender; they didn’t have a real-estate agent and were willing to conduct the entire transaction without agents. Vella contributed to the buyers’ closing costs but did not pay the usual 6% fee, as neither she nor the buyer had hired a traditional agent.

Instead of just breaking even, she saved about $19,000 from the commissions she otherwise might have paid.

Related: Why anyone selling a home should be following the ‘Zillow ban’ lawsuit closely right now

-Aarthi Swaminathan

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