Typical 6% commission no longer around for KY realtors after the settlement

LEXINGTON, Ky. ( FOX 56 ) — Buying or selling a home may look different starting in July, after a lawsuit settlement by the National Association of Realtors (NAR), which has agreed to pay $418 million and change some rules to settle multiple lawsuits regarding the industry’s sales commission fees.

A 6% commission is common compensation for agents, typically split evenly between the buyer and seller agent. Depending on court decisions, as soon as July, realtors may be prohibited from publishing commission percentages in Multiple Listing Service (MLS) , and add a new rule that will require written agreements between the buyer or seller and brokers, regarding commission.

Now, realtors would still be able to put their designated commission out there in another way, but the outcome of the settlement, if finalized, is expected to require more negotiating on commissions, potentially making compensation lower for realtors and maybe lowering the cost of homes.

“It’s not going to change the way that we do business, it’s going to change some conversations we have with the seller. Hey, you know, this is what we charge, but that’s between me and you,” said Randy Newsome, president of Bluegrass Realtors.

Kelly Nesbit, managing broker, at Coldwell Banker McMahan, said she is glad the proposed settlement is in place.

“It allows for real estate professionals to continue being always on point, and providing their clients and the consumer professional service,” Nesbit added.

Realtors said that they advise people to seek out a professional and he does not foresee the settlement affecting home prices.

“The only thing that is going to make homes cheaper, in my opinion, is having more homes for sale and more homes being built,” said Newsome. “I wish I had the answer to say, let’s do this and this to drive the cost down, but this lawsuit has nothing to do with driving the cost down, in my opinion.”

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