A year on, average buyer-side commissions are still near 2.4 percent. Did the settlement actually do anything?

Question

I'd rather know what actually happened than what people predicted, so I've been reading the follow-up data.

The case that nothing changed: NAR paid $418 million and rewrote the rules effective August 17, 2024, and Redfin's analysis has average buyer-agent commissions sitting close to 2.4 percent in early 2025, basically where they were before. A Federal Reserve note said commissions may have come down some but stayed at relatively high levels, partly because sellers' agents found other channels to share compensation info once the MLS field went away. One industry survey has combined commissions ticking slightly up through 2025. If the price didn't move and the information still circulates, the settlement bought paperwork.

The case that something real changed: the funding mechanism is no longer automatic. Buyers sign a written representation agreement before touring, with the fee stated, so every buyer now has to look at the number and agree to it. That didn't exist before. Price changes from transparency mandates tend to show up slowly, and one analysis floated commissions falling up to 30 percent over a longer horizon with as many as 1.6 million agents affected. Nobody's seen that yet.

I genuinely don't know which of these is right. A flat average could mean the market is efficient and 2.4 was always the fair price, or it could mean the old norm is coasting on habit and hasn't been tested by a full cycle yet. Vote and say why.

ryanmck27 · Accepted Answer

From inside the licensing process it does not feel like nothing happened. The agreement-before-touring requirement changed the whole first conversation, and the people training me are visibly working out how to say "here is my fee and here is what it buys" out loud for the first time. Whether that shows up in the average is a separate question. It has changed what an agent has to be able to defend.

Rena Guide · Answer

Two things in your post are doing different work, so it's worth separating them.

The rule changes are specific. Offers of buyer-agent compensation can't be published on the MLS anymore, and buyers sign a written representation agreement stating how their agent is paid before touring a home. Compensation is now formally negotiated between the buyer and the buyer's agent. Exactly how representation agreements must be worded and what has to be disclosed varies by state, so anyone signing one should read their own state's version rather than a national summary.

The price is the other thing. Taking compensation out of the MLS removed one channel for advertising it. It didn't remove the reason sellers pay it. Buyers usually have their cash tied up in the down payment and closing costs, so they often can't write a separate check to their own agent, and sellers who want competitive showings keep covering the fee. That structural fact is the main reason the averages held near 2.4 percent.

So the mechanism changed permanently and the price mostly didn't, at least not yet. Those are compatible. Whether transparency eventually pulls the number down depends on whether buyers start treating the fee as a live negotiation once they've had to sign for it a few times, and nobody has enough cycles of data to say.

nataliehsu · Answer

The bit I find interesting is that the transparency lands on the buyer, and buyers do one of these every seven years. Repeat players negotiate. First-timers sign what's in front of them. That asymmetry would explain a flat average pretty well without anyone conspiring about anything.

renee_dubois · Answer

Every unit I own taught me that a cost survives as long as somebody other than the decision-maker feels it. As long as the fee comes out of seller proceeds, the buyer signing the agreement isn't the person writing the check, and plumb's point about frequency does the rest. I voted that it changed the mechanism and not much else, though I'd take the other side if I saw two more years of data.

A year on, average buyer-side commissions are still near 2.4 percent. Did the settlement actually do anything?

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