LAS VEGAS (KLAS) — Experts say the result of a proposed settlement to a lawsuit against the National Association of Realtors will change how people buy and sell homes in southern Nevada.
The lawsuit, filed in Kansas City, Missouri, challenged the legality of “cooperative compensation offers” that force selling agents to offer “blanket unilateral offers of compensation” to buyers’ agents in order to be included in a multiple listing service (MLS).
A federal class action lawsuit was also filed in Nevada, although experts say the settlement would resolve all of them if accepted, forcing the changes nationwide.
“It’s going to fundamentally change the way real estate is done,” said Nicholas Irwin, professor of economics at the University of Nevada.
Experts say the settlement would disallow home sellers from setting commission rates for the agents of buyers. Instead, buyers would determine their agents’ pay.
Realtors, the designation for real estate brokers who are members of the National Association of Realtors, said they are concerned about the proposed rule. David Berry, a Las Vegas Realtor, said that people should expect to see the change immediately. Berry thinks the process of purchasing a home will become more costly for buyers as they will have to put money aside for a down payment and pay an agent.
“We will lose agents,” Berry said. “There will be people that won’t be able to survive.”
Stefania Moore, also a Realtor in Las Vegas, said she’s worried about the potential consequences of agent commissions no longer being guaranteed.
“A lot of people might not even make that first step of talking to a buyer’s agent to figure out, ‘Okay, what do I need to become qualified,’” said Moore.
According to reports buyers may not be forced to pay agent fees out of pocket, with the proposed new rules allowing buyers to introduce agent compensation into the negotiation, with some sellers being asked to pay the buyer’s agent fee at closing.
The upheaval adds to the stress of an uncertain housing market in southern Nevada, said Luis Monda. He and his wife have all but given up on buying a home.
“I’m 45 years old, and I have more money in the bank than I ever had, and yet, at the same time, we can’t afford to buy a home here,” Monda said.
Carol Nolte, a Las Vegas valley homeowner for more than four decades, said she has been forced to budget more toward a home as time has passed.
“Finding a great agent made the biggest difference of all,” says Nolte.
For their part, the National Association of Realtors issued a statement saying, “The cooperative compensation practice makes efficient, transparent, and accessible marketplaces possible. Sellers can sell their home for more and have their home seen by more buyers while buyers have more choices of homes and can afford representation. The National Association of Realtors will respond to this complaint in court.”
