With Burnett vs. NAR Concluded, New Lawsuits Rankle Industry Further

It’s the talking point to end all talking points these days in the residential real estate industry. Very few people knew well in advance what the fallout might be from the recent Burnett vs. NAR class action trial, in which the defendants, the National Association of REALTORSⓡ (NAR) and real estate franchisors HomeService of America, Keller Williams, and HomeServices subsidiaries BHH Affiliates and HSF Affiliates, were found to have conspired to inflate commissions in violation of federal law, with an award of $1.78 billion to the plaintiffs.

And very few could know that more and even bigger lawsuits would follow immediately. But what most everyone in real estate acknowledges now is that changes to how business has been conducted are almost certain to come.

We asked real estate professionals on all levels to provide their thoughts on how the court cases could impact them as well as the industry. Here’s what they had to say.

“What a mess. I really try hard not to overreact to what ‘might’ happen, but certainly there will be changes in the industry as a result of this suit. Whether that’s a sea of change is still to be seen. Meanwhile, it’s watch and wait for me.” Matt Widdows, HomeSmart CEO & Founder

“Following the trial, I didn’t feel NAR fully explained the value of the organization in addition to state/local associations and the MLS. I can’t imagine the world of real estate without the supervision and enforcement of rules, ethics, morals and values that the NAR holds us to.” Paul Ekstrom, Broker & Owner, Realty ONE Group Choice, Andover, Minnesota

“I think it is a great opportunity for growth and education, for both the consumers and real estate practitioners. I am reserving my opinion on most of it until the appeal process is over. I am expecting some proactive changes in the way we as agents work and explain things to our clients, but ultimately I think the changes will provide a better experience for the consumers.” Jeffrey Decatur, Broker Associate, RE/MAX Capital, Latham, New York

“The industry is going to change. The market is shifting and the strong will survive. The trial forces brokers/agents to have serious conversations with their sellers and buyers to educate them on the market and the benefits of working with a real estate professional.” Melissa Hoff, REALTORⓡ, The Hoff Group at Compass, Fort Lauderdale, Florida

“We (corporate parent Anywhere) were proactive instead of being passive, and settled on these charges without an admission of guilt or wrongdoing. That said, our company listing agreement already separates the listing side of the commission from the buyer side. Our duty to our seller is to inform and disclose. We already let our sellers know that “commissions are negotiable by law” so this is not new.  We point out from the beginning that You are not allowed to ‘set’ a commission, that it needs to be a conversation with the seller for both the listing side and the buyer side.” Joni Usdan, REALTORⓡ, Coldwell Banker, Westport, Connecticut

“I think of the buyers already struggling to afford a down payment and closing costs. Add paying a buyer commission to the costs and you are leaving many out of the market. It saddens me. Because buying real estate helped me so much over the years. It will take away the opportunity to build wealth from a population that should not be left out. It feels like a step backwards as far as equity and inclusion.” Pam Rosser Thistle, REALTOR®, Berkshire Hathaway HomeServices Fox & Roach, Philadelphia, Pennsylvania

“The NAR trial outcome could bring about a major shift in how we structure agent commissions. The verdict has sparked quite the conversation, and many of us are bracing for how this might change our brokerage operations. Among my peers, there’s a lot of talk about the future of commissions and a growing demand for transactional transparency. The trial’s emphasis on how we structure commissions has ignited discussions about fair practices and protecting consumer rights. I can see our profession evolving, perhaps moving towards more flexible commission models and focusing more on the relationships between clients and agents.” Adrian Provost, Principal Broker & President, Realty ONE Group Terminus, Atlanta, Georgia

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