The Truth About the NAR Settlement Agreement

Louisiana REALTORS® • March 28, 2024

Misinformation has been pervasive in the media over real estate commissions. Here are the facts you should know.

Reprinted from REALTOR® magazine


The national conversation around real estate commissions reached a crescendo since the National Association of REALTORS® announced a settlement agreement that would resolve litigation brought on behalf of home sellers related to broker commissions. Brokers and agents have their own questions about what comes next for their businesses, while at the same time trying to answer consumer inquiries. And many headlines aren’t separating fact from fiction, feeding misinformation to you and your clients.


Let’s clear the air: There’s no doubt the litigation—including copycat lawsuits that were filed after the Sitzer-Burnett verdict—caused considerable uncertainty in an industry already dealing with the effects of low inventory and interest rate increases. The settlement, which must be approved by a judge, provides a path forward for real estate professionals, REALTOR® associations, brokerages, MLSs and other industry stakeholders. Most importantly, it gives NAR members the chance to refocus on their core mission to support buyers and sellers.


Facts First

There’s much the media has gotten wrong about NAR’s settlement, which would require the association to pay $418 million over four years. Some outlets have suggested that NAR previously set or guided commissions to a standard rate of 6%. Even President Joe Biden, in recent comments, misspoke in suggesting that the settlement makes commissions negotiable for the first time.


You know that is false. NAR does not set commissions, and commissions were negotiable long before this settlement. They are and will remain entirely negotiable between brokers and their clients. And housing prices are dictated by market forces beyond members’ control.

Getting the facts right is important, especially because the settlement agreement is complex. NAR is continuing to engage with media to correct inaccurate reporting about the settlement. Members are also encouraged to refer to official NAR sources, like facts.realtor, for the most accurate and up-to-date information about the settlement and what it means for consumers.


The settlement achieves two important goals: protecting members to the greatest extent possible and preserving consumer choice. The proposed settlement:

  1. Resolves claims against NAR and nearly every member; all state, territorial and local REALTOR® associations; all association-owned MLSs; and all brokerages with an NAR member as principal whose residential transaction volume in 2022 was $2 billion or below.
  2. Preserves cooperative compensation as an option for consumers looking to buy or sell a home—as long as such offers of compensation occur off of the MLS.


NAR fought for a release that covered all industry players, but large settlements reached by other corporate defendants shaped the negotiations. Throughout the settlement process, NAR also engaged with a diverse range of members to consider their perspectives and interests.


“Ultimately, continuing to litigate would have hurt members and their small businesses,” NAR Interim CEO Nykia Wright said in a statement. “While there could be no perfect outcome, this agreement is the best outcome we could achieve in the circumstances. It provides a path forward for our industry, which makes up nearly one-fifth of the American economy, and NAR. For over a century, NAR has protected and advanced the right to real property ownership in this country, and we remain focused on delivering on that core mission.”


How To Know If You’re Covered

Nearly every member is covered by the release NAR negotiated in the settlement. The members not covered are those affiliated with HomeServices of America, the last co-defendant in the Sitzer-Burnett litigation, and the employees of the co-defendants in the Gibson and Umpa cases.


If you are affiliated with any of the following brokerage groups and are an independent contractor licensee, you are covered by the proposed settlement, even if your brokerage may not be covered:

  • At World Properties LLC
  • Compass Inc.
  • Douglas Elliman Inc.
  • Douglas Elliman Realty LLC
  • eXp Realty LLC
  • eXp World Holdings Inc.
  • Hanna Holdings Inc.
  • HomeSmart International LLC
  • Howard Hanna Real Estate Services
  • Real Broker LLC
  • The Real Brokerage Inc.
  • Realty ONE Group Inc.
  • Redfin Corporation
  • United Real Estate
  • Weichert, REALTORS®


All other REALTORS® who are members of NAR on the date of class notice are covered by the release. The date of class notice is anticipated to be in mid-July.


Members on the date of class notice and state/territorial and local REALTOR® associations must abide by the practice changes set forth in the agreement, but they do not need to take any other action in order to benefit from the negotiated release.


The release does not cover brokerage firms with residential transaction volume above $2 billion in 2022, despite NAR’s effort to include them. For those companies, the settlement provides an avenue to pursue inclusion in the release but does not obligate them to do so.


Changing Business Practices

The settlement agreement also mandates two key changes to the way members and MLS participants do business.

  1. NAR agreed to create a new MLS rule prohibiting offers of compensation on the MLS. This would mean that offers of compensation could not be communicated via an MLS, but they could continue to be an option consumers could pursue off-MLS through negotiation and consultation with real estate professionals.
  2. NAR also agreed to create a new rule requiring MLS participants working with buyers to enter into written agreements with their buyers before the buyer tours a home. NAR has long encouraged its members to use written agreements to help consumers understand exactly what services and value they provide, and for how much.


NAR continues to deny any wrongdoing and maintains that cooperative compensation is in the best interest of consumers. NAR members can use these changes as an opportunity to explain their clients’ options. Both changes would go into effect in mid-July under the terms of the proposed settlement.


NAR considered a range of legal options throughout the litigation process, including reaching a settlement or continuing to appeal the Sitzer-Burnett verdict and litigate the related copycat cases. The latter could have forced the association to file for Chapter 11 bankruptcy protection, leaving members, associations, MLSs and brokerages exposed.


Resources for Members

NAR is committed to supporting members through these changes. Members can get the facts about the settlement at facts.realtor, which is regularly updated with new information and resources, including FAQs.


For those who want to prepare for the new MLS rule requiring buyer representation agreements, consider taking the Accredited Buyer’s Representative (ABR®) designation course(link is external), which NAR is offering to members at no cost through the end of the year.


“NAR exists to serve our members and American consumers, and while the settlement comes at a significant cost, we believe the benefits it will provide to our industry are worth that cost,” NAR President Kevin Sears said in a statement. “NAR is focused firmly on the future and on leading this industry forward. We are committed to innovation and defining the next steps that will allow us to continue providing unmatched value to members and American consumers.


“This will be a time of adjustment, but the fundamentals remain: Buyers and sellers will continue to have many choices when deciding to buy or sell a home, and NAR members will continue to use their skill, care and diligence to protect the interests of their clients.”

2026 Legislative Session Scoop - Week 9 Recap

By Louisiana REALTORS® • May 8, 2026
Week 9 brought several major Louisiana REALTORS® priorities into posture as the Legislature moved deeper into the final stretch of the session. Two of our top priority bills, HB 468 and HB 1027 both by Representative Troy Hebert , cleared the Legislative Bureau and advanced to the Senate floor calendar for third reading and final passage. HB 468, our residential wholesaling regulation bill, remains one of the most important consumer protection measures of the session. The bill brings transparency, accountability, and clear rules of the road to residential real estate wholesaling in Louisiana. HB 468 previously passed the House by a vote of 96–0 and is now positioned for final Senate consideration. HB 1027, which clarifies that licensed real estate appraisers are not liable for a seller’s failure to comply with carbon monoxide detector requirements, also advanced to the Senate floor calendar after previously passing the House by a vote of 90–0. Both bills remain in strong posture, and Louisiana REALTORS® will continue working for final passage as they move through the Senate. Another major development this week was the House passage of HB 1166 by Representative Kim Carver , which passed unanimously on May 5, 103–0. HB 1166 creates a practical disclosure framework for vacant residential property transactions and is designed to help buyers, sellers and real estate professionals avoid late-stage surprises involving access, utilities, drainage, flood risk, prior use and other material property conditions. This bill has been a key part of Louisiana REALTORS®’ consumer protection and transactional clarity agenda. HB 1166 was received in the Senate on May 7 and now moves into the Senate side of the process, where Louisiana REALTORS® will continue working closely with the author and stakeholders as the bill advances. Tort reform and civil justice issues also moved forward this week. HB 437 by Representative Michael Melerine , which addresses the award of expert witness fees in civil litigation, passed the House by a vote of 75–18 and was received in the Senate on May 7. HB 1089 by Representative Dennis Bamburg Jr. , which creates structured CARE Accounts for certain categories of tort damages, passed the House by a vote of 67–29 and was also received in the Senate. Louisiana REALTORS® continue to support meaningful tort reform as part of the broader effort to improve Louisiana’s legal environment, reduce litigation-driven costs, and help stabilize the property insurance market. A more predictable civil justice system directly supports property owners, consumers, businesses and the long-term health of Louisiana’s real estate market. Property insurance remains one of the most important issues facing homeowners and property owners across the state. HB 1187 by Representative Paul Sawyer , dealing with Citizens Property Insurance emergency assessments, has been received in the Senate and referred to the Senate Insurance Committee after previously passing the House by a vote of 87–9. Several additional insurance-related measures remain active, including bills addressing fortified roof endorsements, stated-value homeowner policies, insurance notice requirements, nonrenewal restrictions, and pre-suit claim review. HB 408 , which addresses insurance nonrenewal prohibitions, and HB 1210 , which addresses mandatory pre-suit claim review, remain pending in the House Insurance Committee. Louisiana REALTORS® will continue to closely monitor these measures because insurance affordability, availability and market stability remain central to housing affordability and private property ownership in Louisiana. Several Senate bills also continued moving through the House processes this week. SB 241 by Senator Valarie Hodges , which requires insurance adjusters and appraisers to include their license numbers in written communications, cleared the Legislative Bureau on May 6 and returned to the House floor calendar. This measure remains relevant to transparency, accountability, and consumer confidence in the insurance claims process. SB 180 by Senator Franklin Foil , which allows surviving spouses of deceased disabled veterans to transfer their expanded property tax exemption, was scheduled for House floor debate this week and remains a positive homeowner protection and property tax fairness measure. Louisiana REALTORS® also continues to monitor legislation dealing with blight, redevelopment and rent stabilization. HB 284 by Representative John Wyble , which would authorize certain parishes and municipalities to expropriate blighted property by declaration of taking, remained on the House calendar this week as a notice-given, subject-to-call bill. The bill previously failed on the House floor by a narrow vote of 48–47 and remains under active reconsideration. Blight policy is important, but redevelopment tools must be balanced with private property rights, due process, and protections for property owners. HB 472 by Representative Alonzo Knox , which would authorize municipalities to implement rent stabilization programs, remains involuntarily deferred in committee. Louisiana REALTORS® continues to oppose rent control and rent stabilization proposals in any form because these policies reduce housing supply, discourage investment, and ultimately worsen affordability challenges over time. As we move into Week 10, Louisiana REALTORS® will remain focused on securing final Senate passage of HB 468 and HB 1027, advancing HB 1166 through the Senate, and continuing to engage on the tort reform and insurance measures that directly affect property owners, housing affordability and the real estate profession. With REALTOR® Day at the Capitol taking place during this critical stretch of the session, member engagement will be especially important as legislators continue to make decisions on real estate, insurance, liability, redevelopment and private property rights issues. Please view the weekly bill tracking report provided by our lobbying team over at Harris, DeVille and Associates.

2026 Legislative Session Scoop - Week 8 Recap

By Louisiana REALTORS® • May 1, 2026
Week 8 was one of the most consequential weeks of the session so far for Louisiana REALTORS® and the real estate industry. Two of the association’s flagship bills moved to the brink of final Senate action, rent stabilization was stopped again in committee, major insurance legislation continued to advance, and several bills affecting property rights, tort reform and transaction practice saw meaningful movement. The biggest developments of the week came on HB 468 and HB 1027 , both by Rep. Troy Hebert . HB 468 , the residential wholesaling bill, cleared the Senate Commerce Committee on April 28, had its amendments adopted on April 29, and was referred to the Legislative Bureau putting it one step away from the Senate floor. HB 1027 , the appraiser liability bill, followed the same path after its overwhelming House passage earlier this month and is also now pending Legislative Bureau review before final Senate consideration. Louisiana REALTORS® strongly supports both measures, which are designed to strengthen consumer protection, improve market clarity and reinforce confidence in the real estate transaction process. On the rent-control front, HB 472 by Rep. Alonzo Knox was brought back before the House Municipal, Local and Parochial Affairs Committee this week. Louisiana REALTORS® testified in opposition, and the committee voted 8-5 to defer the bill involuntarily. That is a meaningful win for property owners, housing providers, and the long-term health of Louisiana’s housing market. Louisiana REALTORS® remains firmly opposed to rent stabilization proposals, which may sound politically attractive, but have consistently been tied to reduced housing supply, deterioration in rental stock and long-term affordability problems in markets where they are adopted. Insurance remained one of the session’s most active and important policy areas. HB 1187, Rep. Paul Sawyer , dealing with Louisiana Citizens for emergency assessments, passed the full House 87-9 on April 29, and now heads to the Senate. Because Citizens' assessments can ultimately affect policyholders across the state, this bill has clear relevance for affordability and homeownership costs. HB 408, Rep. Edmond Jordan was heard in House Insurance Committee this week and remains pending. This bill would prohibit insurers from non-renewing residential policies when homeowners have taken documented steps to reduce risk, an issue with direct implications for insurability and failed closings in vulnerable markets. In addition, SB 241 by Sen. Valarie Hodges , which requires insurance adjusters and appraisers to include their license numbers in written communications, cleared House Insurance unanimously and is now headed to the House floor. Taken together, these measures reflect the legislature’s continued focus on insurance stability, transparency and accountability, all of which remain central to real estate activity in Louisiana. Week 8 also brought movement on broader tort reform and property-rights-related legislation. HB 437 , addressing expert witness fees, and HB 1089 , creating structured CARE Accounts for tort damages, both cleared House Civil Law and are now set for House floor debate next week. Meanwhile, SB 180 by Sen. Franklin Foil , allowing surviving spouses of disabled veterans to transfer a property tax exemption, is nearing final House passage after advancing to third reading. While not all of these bills directly regulate licensees, they reflect the broader civil liability and property tax environment that affects the cost and accessibility of owning property in Louisiana. Another key bill for the industry, HB 1166 by Rep. Kim Carver , remains very much alive and is now positioned for House floor debate on Tuesday, May 5 . The bill would require disclosures for vacant residential property, and it would close an existing gap in Louisiana law that currently exempts many vacant homes from standard seller disclosure rules. After being called and returned to the calendar earlier in the week, the bill is now finally set for debate. Louisiana REALTORS® also intends to use the bill as a vehicle for a structural amendment to the Louisiana Real Estate Commission that would move toward a more geographically balanced appointment process, with one member appointed from each congressional district and the remaining members appointed at large. That change would better ensure regional representation across Louisiana’s diverse real estate markets and help modernize the commission’s structure. Taken together, week 8 was a strong and consequential week for Louisiana REALTORS®. The association’s two flagship bills are now within reach of Senate floor passage, rent stabilization was turned back in committee, important insurance legislation continued moving, and HB 1166 remains positioned as both a major disclosure bill and a possible vehicle for meaningful LREC reform. Louisiana REALTORS® remains fully engaged at every stage of the process to protect private property rights, support practical regulation and advance policies that strengthen Louisiana’s real estate market. Lastly, this week, Louisiana REALTORS® wants to extend sincere thanks to Rep. Delisha Boyd — a real estate broker herself — for her tireless work shepherding HB 292 through the legislative process. The security deposit fairness bill, which allows landlords and tenants to mutually agree in writing to extend the timeline for returning a security deposit when damage is found, has passed to third reading and final passage in the Senate and is nearly on its way to the Governor's desk. This has been a meaningful win for both property owners and renters across Louisiana. Please view the weekly bill tracking report provided by our lobbying team over at Harris, DeVille and Associates.
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