The NAR Settlement Was Supposed to Lower Commissions. Here Is What Actually Happened.
The NAR Settlement Was Supposed to Lower Commissions. Here Is What Actually Happened.
The headlines promised lower commissions. A year and a half later, the data tells a different story. Here is a plain-English breakdown of what the 2024 NAR settlement actually changed for home sellers — and what it did not.
If you followed real estate news in 2024, you heard that a landmark lawsuit against the National Association of Realtors was going to change everything. Lower commissions. More transparency. A fairer deal for sellers.
The settlement took effect in August 2024. It is now 2026. And if you are trying to figure out what any of it means for your bottom line, the honest answer is: less than you were probably led to believe.
What Was the NAR Lawsuit?
The NAR class action lawsuit — formally the Sitzer/Burnett case out of Missouri — accused the National Association of Realtors and several major brokerages of conspiring to keep real estate commissions artificially high. The Moehrl lawsuit, filed separately, made nearly identical claims on behalf of a nationwide class of home sellers.
The core argument in both cases was that the longstanding MLS rule requiring sellers to offer buyer’s agent compensation was anticompetitive. Sellers were forced to pay both their own agent and the buyer’s agent, with no real ability to opt out if they wanted their home listed.
In October 2023, a Missouri jury found NAR and several brokerages liable and awarded $1.78 billion in damages. That verdict triggered a wave of similar lawsuits and put enormous pressure on NAR to settle.
In March 2024, NAR agreed to a $418 million settlement, which received final approval in November 2024. Along with the payment, NAR agreed to two key rule changes effective August 17, 2024:
- Sellers would no longer be required to offer buyer’s agent compensation through the MLS
- Buyers would be required to sign a written agreement with their agent before touring homes, making agent compensation an explicit negotiation rather than something baked silently into the seller’s costs
The coverage was wall-to-wall. Commissions were going to fall. Sellers would finally get a fair deal.
What the Data Actually Shows
One year after the settlement took effect, the average national total commission rate is 5.44% — up from 5.32% the prior year, according to a June 2025 report from Clever Real Estate. For context, the pre-settlement standard was 5.5% to 6%. That is not the dramatic drop the headlines promised.
Buyer’s agent commissions averaged 2.40% in Q1 2025 according to Redfin, slightly higher than 2.37% in Q4 2024 and 2.36% in Q3 2024 — when the settlement changes first rolled out.
For homes priced below $500,000, commissions have actually ticked up, climbing to 2.49% in early 2025 from 2.42% in Q3 2024. If you are selling a median-priced home in Indiana or Ohio, you are in this bracket.
On a home priced at the national median of $367,711, a 5.44% total commission comes to roughly $20,000 in fees.
Why have commissions not fallen? Because the market answered the rule change with basic economics. Most sellers are continuing to pay buyer’s agent fees to keep their homes competitive in a slow market where buyers retain leverage. Sellers who do not offer buyer’s agent compensation tend to see fewer showings. In a market with elevated inventory, most sellers cannot afford that risk.
The paperwork changed. The underlying costs largely did not.
What the Settlement Did Change
To be fair, the settlement was not without impact. A few things genuinely shifted.
Transparency increased. Buyer’s agent compensation is now an explicit line item rather than a number buried in MLS rules. Sellers know what they are offering. Buyers know what their agent earns.
Negotiation became more common. A Redfin-commissioned survey found that 37.4% of recent sellers tried to negotiate their agent’s commission — meaningfully higher than before the settlement. That said, 45.9% did not attempt to negotiate at all.
Buyer agreements are now standard. Buyers must sign a written representation agreement before touring homes. This has created friction in some transactions, particularly for first-time buyers with limited cash who previously had agent costs covered quietly on their behalf by the seller.
New selling models have more room to compete. The settlement created more legitimacy for flat-fee agents, discount brokerages, and direct sale options. That shift is still playing out, but the direction is toward more choices for sellers who want to reduce costs.
What Did Not Change
The basic structure of how most homes sell in America is largely intact. The typical commission is still in the 5% to 6% range. Commission rates increased in 39 states from 2024 to 2025, decreased in 10, and stayed flat in New York.
Sellers who need to sell quickly still face the same set of tradeoffs they did before August 2024. The settlement did not create a fast lane. It did not eliminate repair requirements, inspection negotiations, 30 to 60 days on market, or the risk of a deal falling through after you have already moved out.
The Real Math in 2026
Here is what the numbers look like on the ground today.
National median (sale price: $367,711):
| Cost | Amount |
|---|---|
| Total commission at 5.44% | $20,003 |
| Closing costs (1–2%) | $3,677–$7,354 |
| Pre-sale repairs, staging, carrying costs | $5,000–$15,000+ |
| Total cost of selling | $28,000–$42,000 |
Indiana median (approximately $220,000):
| Cost | Amount |
|---|---|
| Total commission at 5.44% | $11,968 |
| Closing costs (1–2%) | $2,200–$4,400 |
| Pre-sale repairs, staging, carrying costs | $4,000–$12,000 |
| Total cost of selling | $18,000–$28,000 |
The settlement trimmed the average commission by roughly half a percentage point from its pre-2024 levels. On a $220,000 Indiana home, that is about $1,100 in savings. A real number, but not a transformation.
The DOJ Angle: This Is Not Fully Over
The class action settlement closed one chapter, but the legal picture around real estate commissions is not finished.
In early 2025, the Supreme Court declined to block the DOJ’s probe into NAR, meaning federal antitrust officials are free to continue scrutinizing NAR’s policies. The DOJ has signaled it is not satisfied with the scope of the private settlement and continues to pursue its own independent investigation — one that industry analysts say may result in enforcement actions pushing for more aggressive structural changes.
The DOJ’s stated goal is a complete decoupling between the seller’s agent and any commission paid to the buyer’s agent — a more thorough change than what the settlement delivered.
What this means practically for sellers in 2026: further changes to commission practices are possible, but they will move slowly through courts and regulatory processes. The math available to you today is the one to plan around.
What This Means If You Are Thinking About Skipping the Agent
The settlement did one useful thing for sellers considering a direct sale: it made the conversation about agent compensation mainstream. Sellers who previously felt uncomfortable questioning the 6% norm now have public permission to push back.
But the settlement also confirmed something important. The reason commissions have not fallen is that buyer’s agents provide real value in a traditional transaction. Sellers who cut them out by going FSBO tend to see smaller buyer pools, longer days on market, and lower final prices that often offset the commission savings. FSBO is not the answer for most sellers.
The real alternative to paying commission is not FSBO. It is removing agents from the transaction entirely on both sides.
When you sell to Skip The Agent, there is no listing agent, no buyer’s agent, and no commission — because there is no MLS listing. We make you a direct cash offer, you review it, and if it works for you we close on your timeline. The $20,000 in total commission that the NAR settlement promised to reduce simply does not exist in that transaction.
Our offers are below retail market value — that is the trade, and we explain it clearly. But once you subtract every fee from a traditional sale, the net difference between a cash offer and a commission-heavy retail sale is often far smaller than sellers expect.
For sellers who also need speed — people behind on payments, going through a divorce, managing an inherited property, or dealing with a home that needs significant work — a cash sale often wins on net proceeds and wins by a wide margin on timeline and certainty.
Get Your Free Cash Offer at skiptheagent.llc
Frequently Asked Questions
What did the NAR settlement change for sellers? The settlement removed the requirement that sellers offer buyer’s agent compensation through the MLS and required buyers to sign written agreements with their agents before touring homes. It did not cap or reduce commissions by law. In practice, most sellers are still offering buyer’s agent compensation voluntarily because market conditions make it the rational choice.
Did commissions actually go down after the NAR settlement? Not in any meaningful way. According to Clever Real Estate’s June 2025 report, average total commissions rose to 5.44% in 2025, up from 5.32% in 2024. Buyer’s agent commissions in early 2025 averaged 2.40% according to Redfin — slightly higher than the period immediately after the settlement took effect.
Do sellers still have to pay the buyer’s agent commission? Not legally. The settlement removed the MLS rule requiring it. But in most markets, sellers continue to offer buyer’s agent compensation because homes that do attract more buyers and more competitive offers. In a market with elevated inventory, most sellers cannot afford to cut the buyer’s agent out.
What is the average real estate commission in 2025? According to Clever Real Estate’s June 2025 survey, the average total commission is 5.44%. On the national median home price of $367,711, that is roughly $20,000. The seller’s agent typically receives around 2.77% and the buyer’s agent around 2.67%.
Can I sell my house without paying any commission? Yes. The two main paths are FSBO — where you list and sell the home yourself — or selling directly to a cash buyer like Skip The Agent where there are no agents on either side and no commission is paid. FSBO carries real tradeoffs around buyer pool size and final sale price. A direct cash sale removes commission entirely but involves accepting a below-market offer.
How does the NAR settlement affect cash home sales? It does not. A direct cash sale does not involve the MLS, agents, or commission in any form. The settlement’s rule changes apply to MLS-listed properties only. A direct cash sale bypasses that system entirely.
What is the Moehrl lawsuit? The Moehrl lawsuit was a separate but related antitrust case filed in 2019 targeting the same commission practices as the Sitzer/Burnett case. Both cases were part of the legal pressure that led to the 2024 NAR settlement.
Is the DOJ still investigating NAR? Yes. The Supreme Court declined in early 2025 to block the DOJ’s probe, leaving federal antitrust officials free to continue investigating NAR’s policies. Industry analysts expect the DOJ to push for more structural changes than the private settlement delivered, though the timeline for any action is unclear.
Should I wait for commissions to drop further before selling? The 2025 data suggests commissions have stabilized near or slightly above their post-settlement level. Further drops are possible but will move through regulatory and legal channels slowly. Waiting to sell based on anticipated commission reductions is unlikely to be worth the carrying costs, market uncertainty, and personal stress of holding a property longer than you need to.
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