The real estate market in the United States could soon change course. In 2023, home purchases fell to their lowest level in 30 years due to various factors, ranging from the rise in mortgage rates to prohibitive home prices.
However, this trend could change thanks to a landmark multibillion-dollar antitrust ruling against the National Association of Realtors (NAR), the largest trade group in the US real estate market.
The expected change in the US real estate market
NAR has agreed to a settlement that would get rid of commissions collected by real estate brokers, which usually amount to up to 6% of the purchase price.
The $418 million settlement is expected to benefit a group of home sellers, who filed a lawsuit against NAR charging that the organization’s rules unfairly inflated agent commissions.
This new ruling seeks to put an end to a series of guidelines and standards established by the NAR that have been one of the main causes of the rise in housing prices. The commissions shared between the buyer’s and seller’s agents may be reduced, suggesting a possible significant drop in prices.
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Ruling to shrink agent commissions
Typically, commissions are 6% and are usually split by the seller’s agent and the buyer’s agent. The revised NAR rules will give home buyers and sellers some leeway to negotiate lower commissions.
Currently, the average price of a home in the United States is $387,000, 6% of which…
