I National Association of Realtors (NAR) and the real estate industry at large have something to be thankful for this Thanksgiving. Judge Stephen Bough of the US District Court in Kansas City, Missouri, on Tuesday gave final approval to the NAR commission’s agreement, and the decisions it reached. HomeServices of America and many MLSs and brokerages have chosen to enter into the NAR Agreement.
The approval comes despite a last-minute filing from Department of Justicewhere the DOJ challenged a settlement provision that required buyers to sign a buyer-seller representation agreement before visiting a home with an agent. The DOJ believes that broker agreements have the potential to “restrict how brokers compete for customers.”
“They are very similar to prior restrictions between competitors that courts have found to violate antitrust laws in other courts and may reduce — rather than enhance — consumer competition among consumers,” the DOJ wrote in its statement of interest filed Sunday. .
The DOJ also noted in its filing that approval of the settlement “does not prevent any future enforcement actions by the United States, and compliance with the proposed settlement or new NAR rules implementing such settlements does not protect against any such enforcement actions.”
Despite these concerns, along with complaints filed by eight individuals and five attorneys who previously filed lawsuits against the copycat commission, Bough gave final approval to the settlement.
Although it is clear from the DOJ’s statement of interest that this saga may not end, Bough’s decision marks the end of this chapter that began on March 15, 2024, when news of the NAR settlement broke.
The deal, which requires NAR to pay $418 million and agree to business changes such as the removal of compensation pledges from the MLS, received preliminary approval in late April. Because of the timeline surrounding the class action notices, the corporate changes — including mandatory consumer representation agreements — went into effect nationwide in Aug. 17.
“This is an important time for NAR members, home buyers and sellers, and the real estate industry,” Kevin Sears, NAR president, said in a statement. “As consumer champions, NAR members have been working tirelessly to make the necessary changes for consumers and consumers during this time of change. The principles of transparency, competition and choice are at the heart of the settlement agreement and empower real estate professionals and consumers to negotiate services and compensation that work for them.”
According to the plaintiffs’ proposal for final approval of the settlement, 15 million postcards and 24 million emails were sent to class members. Using several methods of notification, the attorneys believe they have been able to reach 99% of the settlement class members.
As of last week, nearly 500,000 people have applied to be part of the deal, but eligible real estate agents have until May 2025 to file a claim. In contrast, 39 class members opted out of this facility.
In addition to covering the organization itself, the NAR settlement also protects all brokerages recording less than $2 billion in sales volume by 2022 and all Realtor-affiliated MLSs. For companies that fell outside this list, the settlement included an entry mechanism that allowed them to be protected under the agreement. According to the filing, 13 brokerages and 15 non-Realtor MLSs have opted into the deal. These parties will pay an additional sum of approximately $30.6 million into the settlement fund.
HomeServices of America, on the other hand, will pay $250 million into the settlement fund, as outlined in the agreement negotiated in late April.
In a statement sent to HousingWire on Tuesday, HomeServices of America said it was “pleased” that the settlement received final court approval.
“We are committed to supporting our people as they continue to deliver exceptional service to customers and communities across the country,” said Chris Kelly, HSA vice president. “Our local company leaders, agents, and employees deserve great credit for their exceptional ability to meet the challenges of the past year.”
He continued: “Despite legal and regulatory pressure, ongoing market volatility continues to impact buyers and sellers, requiring new solutions. As we look forward, HomeServices’ full-service model uniquely positions us to meet the needs of today’s consumers, who see home ownership as a proven and reliable way to create wealth. By staying focused on solving these challenges, we aim to deliver unparalleled value and opportunities to our customers and communities.”
This is the third round of settlement of commission cases that Bough has issued its final approvals.
In May, he gave final approval to the areas that were reached Anywhere, RE/MAX and Keller Williams. In October, he issued permits for the settlement reached The compass ($57.5 million), Real Brokerage ($9.25 million), At World Properties ($6.5 million), Douglas Elliman ($7.75 million, but can pay up to $10 million more), Redfin ($9.25 million), Engel & Völkers ($6.9 million), Realty ONE Group ($5 million), HomeSmart Holdings share price ($4.7 million) and United Real Estate ($3.75 million) in the combined Gibson and Umpa lawsuits.
This story will be updated with additional information and comments as they become available.
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