The changes are expected to take effect Aug. 17 and could change how real estate brokers are paid during a transaction process. Officials from the Collin County Area Realtors association, which is affiliated with the NAR, explained how the settlement and policy changes can affect licensed brokers, buyers and sellers in the Dallas-Fort Worth area.
The background
The MLS is an online platform where licensed real estate professionals can list homes for sale or view homes that are already listed. Shana Acquisto, real estate broker and former president of the CCAR, compared the platform to Carfax, an online database that compiles vehicle information for buyers and sellers of used cars.
“You get everything and it’s right there,” she said.
Listing a property on the MLS platform gives it the best exposure, which typically leads to homes selling at higher prices, she said. Individuals have to hold a real estate license to access the application, MLS Director Terry Smith said.
“It’s the truest marketplace that individuals can go to,” he said.
More than 800 MLS platforms are managed by realtor associations across the country, including the CCAR. The platforms are private databases that are created, maintained and paid for by real estate professionals to help clients, according to the NAR’s website.
For realtor associations affiliated with the NAR, the MLS policy changes must be implemented in August, according to a May 3 news release by the NAR.
What’s changing?
The following MLS policy changes are slated to include:
- Sellers can’t post offers of compensation to buyer brokers on the MLS.
- MLS participants can’t filter or restrict MLS listings to clients based on the level of compensation offered to the broker.
- Compensation disclosure to sellers or buyers is required.
- MLS users must enter an agreement with buyers before home tours.
“It's just a change in our process,” Acquisto said. “Really nothing has changed because the fact is commissions have never been fixed.”
Instead of a compensation offer being listed in the MLS, buyers’ agents now have to reach out to the seller’s agent through the MLS to inquire about compensation, she said. Buyers will have to sign a compensation agreement before touring any homes identified through the MLS.
A form already existed for the agreement, but it will now be mandated, Acquisto said.
Smith said the changes present a chance for realtors to be paid differently than they are now. Instead of getting a commission rate for selling a home, they could be paid a fee for services and time offered to their clients, he said.
“There’s going to be more fee structure offerings: different ways that brokers are going to work with their buyers or their sellers,” he said.
What’s next?
After the policy changes take effect, a final approval hearing for the settlement is scheduled later in November.
- March 15: Settlement agreement signed
- April 24: Preliminary approval of settlement review granted by the court
- Aug. 17: Practice changes take effect, earliest day for class action lawsuit notifications to be issued to those impacted
- Nov. 26: Final approval hearing for the settlement
For potential clients looking to buy or sell a home, Acquisto recommended they connect with a licensed real estate professional. Buying a home is a complex and complicated process, and nobody should do it alone, she said.
“Maybe some of the conversations are different, but since the beginning of time we’ve changed our processes and they’ve improved,” she said. “Change is a constant. What hasn’t changed is the law of agency and how we represent our clients on both sides.”
Education Reporter Brittany Anderson contributed to this story.
