A landmark settlement is shaking up the real estate industry.Last week, the National Association of Realtors settled multiple lawsuits, agreeing to do away with decadeslong policies that set agent commissions.NAR agreed to pay $418 million in damages, effectively ending the standard 6% commission.”They were focused on sellers and buyers not understanding who’s being compensated in a transaction,” Mike Ruzicka, the president of the Greater Milwaukee Association of Realtors, explained.He said practices in other states vary greatly from real estate transactions in Wisconsin.”The state takes a great deal of effort in making sure consumers know what’s going on in a transaction,” Ruzicka said.There are two main new provisions of the settlement.The NAR can no longer require a broker listing a home on the MLS to offer any upfront compensation to the buyer’s agent.Also, agents must enter into a written agreement, including a negotiated commission and fees, with the homebuyer.We asked a Marquette University Law professor who specializes in property if this means lower home prices.”In the short term, no. What drives the real estate market currently is lack of supply,” Kali Murray said.”It’s not going to impact home prices at all. Prices are determined by buyer and seller, when they agree on the price,” Ruzicka added.Both experts say whether you’re looking to buy or sell, you need to pick the right person to help.”I would talk to more than one buyer agent,” Murray said.”Contact an expert that knows what they’re talking about when you want to sell or buy a house,” Ruzicka said.
MILWAUKEE —
A landmark settlement is shaking up the real estate industry.
Last week, the National Association of Realtors settled multiple lawsuits, agreeing to do away with decadeslong policies that set agent commissions.
NAR agreed to pay $418 million in damages, effectively ending the standard 6% commission.
“They were focused on sellers and buyers not understanding who’s being compensated in a transaction,” Mike Ruzicka, the president of the Greater Milwaukee Association of Realtors, explained.
He said practices in other states vary greatly from real estate transactions in Wisconsin.
“The state takes a great deal of effort in making sure consumers know what’s going on in a transaction,” Ruzicka said.
There are two main new provisions of the settlement.
The NAR can no longer require a broker listing a home on the MLS to offer any upfront compensation to the buyer’s agent.
Also, agents must enter into a written agreement, including a negotiated commission and fees, with the homebuyer.
We asked a Marquette University Law professor who specializes in property if this means lower home prices.
“In the short term, no. What drives the real estate market currently is lack of supply,” Kali Murray said.
“It’s not going to impact home prices at all. Prices are determined by buyer and seller, when they agree on the price,” Ruzicka added.
Both experts say whether you’re looking to buy or sell, you need to pick the right person to help.
“I would talk to more than one buyer agent,” Murray said.
“Contact an expert that knows what they’re talking about when you want to sell or buy a house,” Ruzicka said.
