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It won't change much in agents attitudes about fees they expect sellers to absorb. Most will deal at 2-1/2 which is still a ripoff on the seller. One thing for certain is there are too many agents.

It won't change anything. They're just being fined. You cannot tell a business what they have to charge. It would be like telling Boeing what they can charge for a jet or what they pay a sales person. You can sell a house without a broker. You can negotiate sales commissions NOW. This is really just greedy attorney's looking for fees whether they win or lose.

If anything this will be a big hit on the insurers of these big brokerages raising rates on other insurance products to cover the losses like they do with natural disasters. That's who's paying the fines. The overall cost to consumers will be higher than the fines. That money goes to attorneys. If people don't know they can negotiate a commission, maybe they shouldn't be buying a house either, right? FYI I was a Realtor and I despise the living fuck out of them.

Just being realistic with the outcome of this. Nothing and I mean nothing changes. Keller Williams specifically I know enough about. I sat at a table with Gary Keller multiple times down in Austin. He's 10 steps ahead of any of this shit. I'm talking over a decade ago. This comes up every few years when sales prices are high. No one gave a shit when banks were paying 5-6% in 2008-2013 on REO's and short sales. Again, attorneys being the bigger rat in this race to the bottom is what this is about.

Has a fine like this ever been levied before on this? If no, then it must be big news.

GNL says

Has a fine like this ever been levied before on this? If no, then it must be big news.

It's news for sure, but it's a fine. My money bets that it becomes a disclosure that must be presented at or prior to a listing appointment. Basically NAR will implement it in their "code of ethics" and that will satisfy the courts and the fine gets paid and the status quo remains. Sellers won't read the disclosure. 5-6% will continue to be the norm. A few more people might negotiate then normal.

Also, this propaganda that all listings are signed at 6% is BS. It's math and data on humans. 6% is the higher threshold a seller is genuinely willing to absorb on a sale. If you're in sales, you try to get the most out of the sale and 6% is that number in real estate. We didn't run around telling other brokers to sign their listings at 6%. You close a deal and back the numbers out on the HUD and all parties know what the listing was signed at. Nothing is hidden. No one gets screwed over unless they cannot do basic math. The seller and buyer just didn't negotiate. That's kind of on them.

Problem is this opens a bigger can of worms if they regulate commissions for a ton of industries and that's what will be argued. Sales people in many industries set the price of the product AND their commission. Say you sell the same plane to two different people on the same day. One pays full price and another negotiates 10% down on price. Is that fair to the costumer paying full price? I think most would say no, but that's life. Same in car sales.

It's a ploy for attorneys to get money out of NAR and big brokerages. 30% fees on the attorney side of this most likely, plus expenses (that they write off). $540M.... We know what this really was about. Definitely not about restructuring commissions in the RE industry. And if they regulate and restructure the industry we're going to end up with a Boeing and Airbus situation where it's still a monopoly but there will just be a few massive brokerages. I think that's worse for everyone.

Negotiate. I've yet to hear of any broker holding a gun to someone's head to sign a contract or listing agreement. But let government get its dirty hands in on it.... said no one. Commission regulation would kill tons and tons of small vendors. If you're not the "preferred" vendor of Keller Williams, REMAX, Coldwell Banker, you're toast because those brokerages would be the only ones allowed to exist on lower commissions.

Again, I despise most brokers. Some are okay and very few good. All I'll say is the grass isn't greener on the other side.

Here is some interesting fodder from the NAR:
https://www.nar.realtor/about-nar/governing-documents/code-of-ethics/code-comprehension-article-16-commissions-are-negotiable

Q: There is a home in the MLS that I think my buyer client would love, but the commission being offered by the listing broker is lower than I want to be paid. It’s so low that it won’t cover the time or effort I put in to representing the buyer throughout the transaction. I want to do the right thing. What can I do?

A: Since you believe that your buyer client would love the house, you have an ethical duty to show the listing to your client. But you have a few options to address the fact that the compensation being offered is inadequate. First of all, buyers and sellers can negotiate the commission paid to their brokers and agents at any time. When representing a buyer, you should consider using a buyer agency agreement that sets forth the services you will provide and establishes what compensation your client will be responsible for paying. Often, the buyer agency agreement explains that you will first seek to be compensated in the amount set forth in the listing, but that if that amount is inadequate, you will expect the client to make up the difference between ___ and the compensation provided by the listing broker. It is entirely up to you how you will fill in the blank. The buyer agency agreement is between you and your client, so you and your buyer can negotiate the terms of that agreement at any time.

Additionally, with one exception, you could ask the listing broker to negotiate the offer of commission. The one exception is that you may not submit an offer to purchase that is contingent upon an increase in the commission paid to you by the listing broker. An offer of that nature is thought to be inconsistent with your fiduciary duty to the client. This request can be made at any time during the transaction, even after showing the property or submitting an offer to purchase on behalf of the client.

You could also have a conversation with your buyer client about the commission being too low to cover your time and costs incurred in connection with representing that client. If your client so wishes, he or she could make the decision to condition the offer to purchase the property on an agreement by the seller to pay an additional specified amount. The buyer and the seller are the parties to any contract to purchase the listed property. They can negotiate the terms of that contract as they see fit. Just make sure that your client completely understands the pros and cons of submitting an offer with that type of contingency, and make sure not to pressure your client in any manner that is inconsistent with your fiduciary duty to that client.

OK, so the NAR says if the buyer's agent commission isn't 3%, strongarm the buyer or seller to pay the difference?

zzyzzx says

Since you believe that your buyer client would love the house, you have an ethical duty to show the listing to your client.

Really? Does the agent also have to show For Sale By Owner homes as well?

zzyzzx says

OK, so the NAR says if the buyer's agent commission isn't 3%, strongarm the buyer or seller to pay the difference?

The buyer' agent is doing the actual work of bringing a buyer, they need to be compensated. The place to save is on the listing side, where it should be a flat fee or just 1%.

HeadSet says

The buyer' agent is doing the actual work of bringing a buyer,

The buyers are looking at listings online and only going to places that they request to see. The buyer's agents are finding the buyers, the buyers are finding the agents.

Noooooo! NOT THE 6% COMMISSION!!!! YOU BASTARDS!!!!