NAR seeks to clarify commissions settlement details
In a call with media, NAR reps sought to dispel confusion and misinformation coming out of the March 15 settlement announcement.
Key points:
- NAR clarified to the press that listing brokers could display an offer of compensation to a buyer agent on their own website.
- It appears that NAR did not give brokerages or partner organizations a heads up prior to Friday’s announcement.
- NAR reps repeatedly asked members of the press to read the full settlement agreement in order to understand the facts.
On March 19, NAR held a press call to go over the details of Friday's settlement announcement, push back on what it perceives as misinformation surrounding the news, and clarify what the deal means to the organization and to the broader industry.
Here are a few of the key takeaways:
Offers of compensation won't be prohibited on agent websites
While offers of compensation will be prohibited from the MLS starting in mid-July, NAR told reporters that brokers and agents have other methods to negotiate compensation.
"The obvious ways would be phone calls and emails," an NAR representative said to journalists, adding that real estate professionals can also "put something generally on their website."
The agreement "does not speak to the aggregators and what the aggregators will do," the representative said of the home search portals.
But don't expect to see home search portals or independent brokerage websites replace the MLS. The agreement "really is designed to ensure that if a broker and their client wants to communicate the offer of compensation via their own website, that they can do so without risking losing their IDX feed," the representative said.
Affected brokerages and other NAR partners did not get advance notice
While many industry leaders and major companies have put out statements since Friday morning commenting on the settlement and changes to rules, it appears that the information in NAR's announcement was not shared in advance with other organizations or individuals.
"As you probably know, settlements are negotiated confidentially," an NAR representative told reporters. "And so we have respected our obligations under those rules to make sure that we are not violating the confidentiality that we're obligated to follow along with."
"In the end, this is a settlement that was negotiated by the National Association of Realtors that people will hopefully find some value in, but it was not a multi-party negotiation," the rep added.
NAR wants everyone to read the settlement agreement
NAR reps repeatedly asked journalists and industry watchers to review the full settlement agreement, presumably in an effort to combat what NAR believes to have been mischaracterizations of the agreement or irresponsible reporting on the subject.
"We've seen a lot of discussions in the public about what people are saying about the agreement, but [they] have never read it," an NAR spokesperson said, adding that the agreement still has to be approved by the court. "So let me be clear: NAR does not set commissions, and commissions are negotiable," another representative said.
Friday's announcement has led to widespread speculation about the future of buyer agency, commission splits, and who is still open to litigation. But there has also been a flurry of confusion and chatter on and offline as industry leaders rush to inform their teams of the latest rule changes and how they will impact individual agents and teams.
This story has been updated to clarify that home search portals cannot use MLS data and display offers of compensation.