T
he real estate industry has undergone significant changes since a landmark settlement with the National Association of Realtors (NAR) altered the traditional commission structure. Real estate brokers reflect on how the industry has evolved since the settlement took effect.

    Prior to the settlement, standard broker compensation was 6% of the purchase price, split equally between listing and buyer's brokers. This practice raised questions about fairness to sellers, particularly when their broker had to agree to split the commission with the buyer's broker as a condition of listing on the multiple listing service (MLS). The MLS, operated by the NAR or local affiliates, was once the primary means of mass-advertising properties and attracting qualified buyers.

    The settlement in 2023, which included $418 million in compensation for plaintiffs, marked a significant shift away from the traditional commission structure. The National Association of Realtors has since pledged to reform its business practices, potentially paving the way for more flexible and competitive pricing models.