The Domos Report Vol. 5
THE DOMOS REPORT
The Domos Report | Fifth Edition | 2/2025
GREETINGS FROM SUZANNE!
I hope everyone is having a fantastic start to 2025! Welcome to the fifth volume of the Domos Report. In this edition, we’re exploring the NAR lawsuit that made waves across the real estate industry in 2024.
85% of realtors did not renew their licenses after two years, and 71% did not sell a single home last year! It is a very tough business, and process changes may make it even tougher.
NAR Lawsuit: What are the facts?
In 2024, a class action lawsuit filed against the National Association of Realtors (NAR) alleged the real estate community was artificially inflating commissions by requiring sellers to offer compensation to buyers' agents when listing on the Multiple Listing Service (MLS). The lawsuit claims this practice forced sellers to pay higher fees, violating antitrust laws and limiting competition. NAR settled, and the agreement mandated changes in how we, as real estate agents, conduct business.
The settlement was surprising as commissions have always been negotiable and transparent. Every company has a pricing structure that is based on the services it provides. Discount brokerage firms typically charge a flat fee to place the listing in the MLS and then do nothing else. Some brokerage firms offer an “a la carte” menu with an array of options for clients. Full-service companies, like @properties, provide deep and broad services to clients. Other firms do everything in between with more of a pay-for-service model. In short, there has always been commission flexibility for the buying and selling public.
The settlement dictates significant but nuanced changes that impact the industry. However, the two most notable issues that change the process for buyers and sellers are as follows:
1) Historically, the commission offered to the buyer’s broker was displayed on the MLS. However, this can no longer be communicated there. Instead, it must be negotiated outside of the MLS system.
2) Brokers must have a signed agreement with a buyer (just as we always have with sellers) before they can conduct brokerage-related activities including showings. Buyers need to sign these documents that outline clearly what services a broker is providing. The buyer’s agent commission fee must be part of this agreement.
How does the commission get paid?
For sellers:
Sellers and their brokers will determine only the listing side commission in their agreement. They can discuss with their agent the amount they might be willing to compensate a buyer’s broker, but that percentage is no longer in the MLS.
For buyers:
A buyer must be represented, and that relationship starts the first time they meet to see a property with the agent. Purchasers can ask the seller to pay their commission when presenting an offer. Alternatively, a buyer can pay their broker directly a negotiated fee. Or, if the buyer is getting a mortgage, credits can be applied through the lender.
What has the marketplace done?
Yes, we have new forms that need to be completed, but practically and financially, not much has changed. Since the new law went into place last August, in 100% of the transactions I have done, the buyers asked the sellers to pay the commission for their agent and the sellers have all complied. Business as usual!
The commission was always “baked into the price of the cake” when a buyer purchases or when a seller sells. While it appeared that the seller was paying, that commission amount was just part of the purchase price, so the buyer absorbed it as well. Buyers were always paying part of the commission. That hasn’t changed.
Much Ado About Nothing
While there is more paperwork, my commitment to serving my clients—whether they are buyers or sellers—remains the same. I provide excellent service and earn their trust. My goal is my clients' happiness with the outcome at the end of the transaction. No DOJ action could change that.
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Within one of the most recognizable buildings on Lake Shore Drive, you'll find this Benjamin Marshall designed co-op apartment with panoramic lake views, grand rooms and timeless details.
What Her Clients Are Saying:
“Suzanne is tough, patient, kind and a truly fierce negotiator. She had great people skills handling the personalities in a difficult transaction—a real pro. Her knowledge of the market is broad and wide. I will always recommend.”
-L.B. Lincoln Park
“Suzanne is an extraordinary professional with a masterful knowledge of the real estate market. She exudes calm, grace, humor and a strong sense of integrity and I trust her in any situation. This was my first time to have a partner like Suzanne when selling a house. I will use her again and again.”
-P.S. West Loop