Following recent inaccuracies in media coverage, including the false representation or suggestion that the National Association of REALTORS® (NAR) requires a standard 6% commission, NAR issued a statement on March 19, 2024.
In their statement, NAR emphasized that they do not set commissions and all commissions are negotiable. The rule at issue in the recent nationwide claims brought by home sellers requires only that listing brokers communicate an offer of compensation. The compensation offered can be any amount, including zero. Further, there are other rules throughout the MLS Handbook and NAR policy which expressly prohibit MLSs, associations, and brokers from setting or suggesting any such amount that should be included in that field. As a result of the settlement, NAR has agreed to put in place a new MLS rule prohibiting offers of broker compensation on the MLS. Commissions remain negotiable, as they have been.
The text of the current rule is linked here and reads as follows:
In filing property with the multiple listing service, participants make blanket unilateral offers of compensation to the other MLS participants and shall therefore specify on each listing filed with the service the compensation being offered by the listing broker to the other MLS participants. This is necessary because cooperating participants have the right to know what their compensation will be prior to commencing their efforts to sell.
The listing broker retains the right to determine the amount of compensation offered to subagents, buyer agents, or to brokers acting in other agency or nonagency capacities, which may be the same or different.
The text of our MLS Antitrust Compliance Policy is linked here and reads as follows:
The purpose of multiple listing is the orderly correlation and dissemination of listing information to participants so they may better serve the buying and selling public. Boards and associations of REALTORS® and their multiple listing services shall not enact or enforce any rule which restricts, limits, or interferes with participants in their relations with each other, in their broker/client relationships, or in the conduct of their business in the following areas.
Boards and associations of REALTORS® and their MLSs shall not:
- Fix, control, recommend, or suggest the commissions or fees charged for real estate brokerage services (Interpretation 14).
- Fix, control, recommend, or suggest the cooperative compensation offered by listing brokers to potential cooperating brokers.
Finally, here is a notice included in NAR’s MLS Handbook:
Under the long-established policy of this association, the (state) association of REALTORS®, and the National Association of REALTORS®:
- The broker’s compensation for services rendered in respect to any listing is solely a matter of negotiation between the broker and his or her client, and is not fixed, controlled, recommended, or maintained by any persons not a party to the listing agreement.
- The compensation paid by a listing broker to a
cooperating broker in respect to any listing is established by the listing
broker and is not fixed, controlled, recommended, or maintained by any persons
other than the lister broker. (Amended 4/92)
