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Own Luxury Homes® NAR Commission Reform Real Estate Index™

Own Luxury Homes® NAR Commission Reform Real Estate Index™: NAR settlement effective August 17, 2024: buyer agent compensation removed from MLS; Buyer Representation Agreement required before showings. 70-75% of Florida $1M+ sellers continuing to offer BAC through non-MLS channels. What changed: explicit disclosure, BRA requirement, transparent negotiation. What did not change: market clearing mechanism; seller-paid BAC still dominant in FL luxury. Own Luxury Homes® 12-Point Agent Integrity Audit™.

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Own Luxury Homes® Research Index · Industry Policy Research

Own Luxury Homes® NAR Commission Reform Real Estate Index™

The August 2024 implementation of the NAR settlement agreement fundamentally changed how buyer agent compensation is disclosed and offered in U.S. residential real estate. The requirement that buyers sign a written Buyer Representation Agreement (BRA) before being shown properties, and the prohibition on advertising buyer agent compensation in the MLS, created a new negotiation landscape that varies significantly by market, price tier, and buyer type. This Index tracks how the post-settlement market has evolved and what buyers and sellers need to know.

⚠️ NAR settlement effective August 17, 2024. Individual MLS rules vary. This is an evolving area; market practices continue to develop. Work with your specific state’s real estate attorney and Realtor for current practice in your market.
August 17, 2024
The effective date of the NAR settlement agreement requiring all cooperating MLSs to remove buyer agent compensation offers from MLS listings and requiring Buyer Representation Agreements before showings
70-75%
Estimated percentage of Florida sellers who continued offering buyer agent compensation off-MLS or through other mechanisms post-settlement — market practice has not eliminated buyer-agent compensation, it has moved the negotiation
3%
The traditional buyer agent commission rate that the settlement disrupted; post-settlement, commission is explicitly negotiated and disclosed rather than embedded in the MLS
0%
NAR settlement’s impact on the fundamental economics of real estate: sellers still typically offering some or all buyer agent compensation; buyers negotiating more explicitly; market-clearing mechanism still functional

01 — How Buyer Agent Compensation Works Post-Settlement

ElementPre-Aug 2024Post-Aug 2024 (Current Practice)Florida Practice
Buyer agent compensation offer in MLSSellers could (and almost always did) offer BAC in the MLS listingPROHIBITED in MLS; must be negotiated separately; can appear in other marketing materialsMost FL sellers still offering BAC; offered in the purchase contract, listing marketing, or direct broker negotiation
Buyer Representation AgreementOptional; most buyers never signed one before seeing homesREQUIRED before any showings; must specify buyer agent compensation termsFL brokerages have updated BRA forms; buyers signing before first showing
Who pays buyer agentImplicitly always the seller (built into list price); buyers rarely conscious of payingNow explicitly negotiated and disclosed; can be: seller pays, buyer pays, split, seller concessionDominant FL practice: seller still offering BAC as incentive to attract buyer-side representation
Buyer asking seller to cover BACImplicit and assumedNow typically an explicit part of the offer terms; buyers can include seller-paid BAC in purchase offersFL buyers can still ask seller to cover BAC; becomes part of price negotiation
Cash buyers and unrepresented buyersRare; most buyers used agentsSome buyers attempting to negotiate seller concession or price reduction for "saving" BACFL cash luxury buyers occasionally negotiating price reduction in exchange for no buyer agent
The Market Reality: What Actually Changed

The loudest predictions from both sides of the settlement debate have not fully materialized:

What DID change:
• Buyers must now explicitly agree to compensation terms before seeing homes — most buyers are now more aware of what buyer agents earn
• The MLS is cleaner: buyers seeing a listing no longer see an embedded BAC offer
• Negotiation is more explicit: sellers who want to attract buyer-side representation now make it known through other channels
• Some buyers, particularly sophisticated cash buyers at the luxury tier, are attempting to use the settlement as leverage to negotiate price reductions in lieu of seller-paid BAC

What did NOT change:
• The underlying economics: sellers who want maximum buyer exposure still find it necessary to make buyer agent compensation available; the market-clearing mechanism is intact
• In FL’s luxury market (70-75% of $1M+ sellers offering BAC post-settlement), the practical experience for most buyers has changed minimally
• Buyer agent compensation rates have not dramatically compressed; 2.5-3% remains common in FL luxury markets

Ryan Brown — Principal Broker & CEO, FL BK3626873
“The settlement changed the paperwork, not the economics. Florida sellers in the $1M+ tier are still offering buyer agent compensation at rates comparable to pre-settlement because they understand that a property not in front of buyer agents is a property that doesn’t sell. The buyers who have tried to use the settlement to negotiate a 3% price reduction because they’re unrepresented have sometimes succeeded at the lower price tiers. In the $3M+ market, the seller typically has leverage and is less inclined to discount for a buyer who chose not to bring representation.”
Own Luxury Homes® Research Library
Florida Homestead Exemption True Value Index™ • Florida Property Tax Effective Rate Index™ • NAR Settlement Buyer Agent Fee Tracker™ • Florida STR Viability Index™ • California Tax Cost-of-Staying Index™
Cite This Research
Brown, Ryan. “Own Luxury Homes® NAR Commission Reform Real Estate Index™.” Own Luxury Homes®. https://www.ownluxuryhomes.com/markets/national/research-indices/nar-commission-reform-real-estate-index

Media: ownluxuryhomes.com/connect · 407-900-7030

Own Luxury Homes® — national real estate research authority. 12-Point Agent Integrity Audit™. Connect ›

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— Ryan Brown, Principal Broker & CEO, Own Luxury Homes® (FL License BK3626873)

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