Realtor settlement on commission-fixing could create seismic changes in how Americans buy homes | CNN Business
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The 6% commission, a standard in home purchase transactions, is no more.

The 6% commission, a standard in home purchase transactions, is no more.

In a sweeping move expected to reduce the cost of buying and selling a home, the National Association of Realtors announced Friday a settlement with groups of homesellers of landmark antitrust lawsuits by agreeing to pay $418 million in damages and eliminating rules on commissions.

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In November, a federal jury in Missouri found the NAR and two brokerages liable for $1.8 billion in damages for conspiring to keep agent commissions artificially high. The NAR had pledged to appeal the case, but other brokerages settled — and, eventually, so did the NAR on Friday.

NAR had required homesellers to pay a set 6% commission that is typically split evenly between the seller’s agent and the buyer’s agent. Although the NAR said the commission was negotiable and helped make housing more affordable for buyers, critics have long argued that the fees were effectively set and made housing more expensive.

  • Wooster@startrek.websiteEnglish
    0·
    6 months ago

    I’m not gonna shed any tears on that, but this is peripheral to the root issue and why that commission is out of control.

    Solve why homes cost a ransom in this first place, and that 6% commission should drop proportionally.

    • tacosplease@lemmy.world
      0·
      6 months ago

      Yeah it all comes down to a shortage of homes. The bubble popped around 2008 and construction of new homes stopped. Ever since then we haven’t been building enough homes, so there is a shortage driving up prices. Until we make more places to live, home prices will be outrageous.

      • Modern_medicine_isnt@lemmy.world
        0·
        6 months ago

        I am always baffled by “the shortage of home”. Population growth is pretty slow. And the news claims more young adults are living with thier parents. So where are all the homes going?

        • tacosplease@lemmy.world
          0·
          6 months ago

          The homes didn’t go anywhere. They don’t exist. Developers basically stopped building enough homes in 2008. Since then the population growth has vastly outpaced the number of homes being built. Now we’re years away from having enough housing because it takes time to catch up building them. Unfortunately prices are not going to significantly drop any time soon.

      • Zipitydew@sh.itjust.works
        0·
        6 months ago

        Many of the builders went under. The ones that survived were typically building more expensive (ergo higher margin) housing. Which is why they’ve continued doing so up to today.

        I don’t recall exactly now but read a while back around half the home building companies in the US were defunct by 2012.