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What’s new and what’s next, post-NAR commissions deal? 

The Supreme Court passes on a chance to weigh in, objections pile up, and Fannie and Freddie say it’s all right to exclude commissions from seller concessions.

April 20, 2024
3 minutes

It's been a busy few weeks in the world of commissions litigation — and compensation clarification — but the dust is beginning to settle.

Here are some of the recent developments real estate professionals should be aware of:

Clarity on commissions: Some good news of sorts came from Fannie Mae and Freddie Mac this week, as both federal finance giants affirmed that commissions will remain excluded from limits on seller concessions — a key question that emerged in the wake of NAR's landmark commissions settlement.

There was confusion and concern among some in the industry that rule changes included in the settlement might affect loan limits. One of the new rules allows sellers to offer concessions that could include payment of buyer agent commissions — but lenders place limits on what concessions can be financed.

Fannie and Freddie clarified that buyer agent commissions will continue to be excluded from limits on seller concessions, making it easier for home sellers to have the option of contributing to buyer agent commissions.

Brokerage settlement objections: There's also been a steady stream of objections being filed in the settlement proposals for Anywhere, RE/MAX and Keller Williams. One noteworthy objection came from PulteGroup, the nation's third-largest home builder, who expressed concern over the claim process and the company's ability to tap into the settlement funds.

HomeServices of America had a win some, lose some week: The lone defendant in the Sitzer/Burnett case had a busy week, failing to get the U.S. Supreme Court to consider throwing out the October verdict over arbitration issues, but succeeding in delaying a damage award judgment entry in that case until other motions are resolved.

Any updates on the NAR settlement? As of April 19, U.S. District Court Judge Stephen Bough has not granted preliminary approval of the deal, but that's expected to happen soon. In papers filed about a different motion, attorneys for the Sitzer/Burnett plaintiffs estimated that final approval, however, may not come until early 2025.

Cases restarting: Since a panel of judges ruled that now is not the time for consolidation, many of the copycat cases, as well as some of the original lawsuits like Nosalek and Moehrl, are in the process of restarting. Many cases had been paused while awaiting the panel's ruling.

For the Nosalek case in Massachusetts, HomeServices has renewed its motion for a summary judgment, while the plaintiffs filed a notice saying they plan to have a response to the Department of Justice's Statement of Interest next month.

What to look for next: A hearing on finalizing the settlements for RE/MAX, Keller Williams and Anywhere Real Estate is scheduled for May 9, while proposed rule changes coming out of the NAR deal — including removing the offer of compensation field from Multiple Listing Services and requiring all agents to get signed buyer agreements before showing homes — are scheduled to go into effect in July, though the dates are still tentative.

One of the biggest unknowns at this point is what the DOJ will do next. A recent ruling allows the law enforcement agency to reopen its investigation into NAR over potentially anticompetitive  practices, and the DOJ has signaled that it wants to see even more sweeping changes in the industry.

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