The August 2024 NAR settlement fundamentally changed how real estate commissions work in the US. The traditional model — where the seller automatically paid both agents’ commissions through the MLS — is gone. In 2026, buyer agent compensation must be negotiated explicitly between buyers and their agents.
What Changed: The Old vs New System
| Feature | Old System (before Aug 2024) | New System (Aug 2024+) |
|---|---|---|
| MLS compensation offer | Seller offered buyer agent % in MLS listing | Prohibited — cannot list buyer agent % in MLS |
| Buyer agent agreement | Often informal | Required written agreement before touring |
| Who pays buyer agent | Seller (automatically via MLS offer) | Negotiated — buyer, seller, or split |
| Seller’s total commission | 5%–6% bundled | 2%–3% listing agent (+ optional buyer agent concession) |
| Buyer’s upfront obligation | Nothing | Sign compensation agreement specifying fees |
The NAR Settlement: What Happened
In March 2024, NAR settled a $418 million antitrust lawsuit (Sitzer/Burnett v. NAR) with rule changes effective August 17, 2024:
- No MLS compensation displays: Listing services cannot show buyer agent compensation offers
- Written buyer agreements required: Agents must have signed buyer representation agreements before showing homes
- Explicit compensation: All buyer agent fees must be clearly disclosed and agreed upon before representation begins
The DOJ has continued to monitor the real estate industry, and further changes to commission practices are possible.
What Buyers Pay Now
Buyers must now negotiate their agent’s compensation directly:
| Buyer Agent Compensation Model | Rate | On $420K Home |
|---|---|---|
| Traditional commission | 2.5%–3% | $10,500–$12,600 |
| Negotiated commission | 1.5%–2% | $6,300–$8,400 |
| Flat fee buyer agent | $3,000–$7,000 fixed | — |
| No buyer agent (direct purchase) | $0 | $0 |
The seller concession option: Buyers can ask sellers to cover the buyer agent fee as a concession. On a $420,000 offer, a buyer might ask for a $10,000 seller concession toward the buyer agent fee. The seller either accepts, counteroffers, or declines. This effectively rolls the fee into the purchase price (and thus into the buyer’s mortgage).
What Sellers Pay Now
Sellers who want to attract buyers with agents can still offer buyer agent compensation — they just can’t do it through the MLS:
| Seller Option | Description |
|---|---|
| Offer buyer agent compensation in listing | Now done in private negotiations / direct to buyer’s agent |
| Include in purchase agreement | Seller agrees to cover buyer agent as a concession |
| Offer nothing | Buyer must pay their own agent; may reduce buyer pool |
In 2026, most sellers still offer buyer agent compensation — typically 2%–2.5% — because refusing to do so limits the pool of buyers who can afford separate agent fees.
Total seller transaction costs in 2026:
| Cost | Typical Amount |
|---|---|
| Listing agent commission | 2%–3% |
| Buyer agent compensation (if offered) | 2%–2.5% |
| Seller closing costs (transfer taxes, title, etc.) | 1%–3% |
| Pre-sale repairs and staging | $2,000–$10,000 |
| Total cost to sell (% of price) | 5%–9% |
How to Navigate the New Rules as a Buyer
- Sign the buyer agreement before touring — it’s required. Read it carefully. Look for: compensation rate, how long the agreement lasts, and whether it’s exclusive
- Negotiate the rate — agents often accept 1.5%–2% in competitive markets; some offer flat fees
- Ask sellers for concessions — request that the seller cover your buyer agent fee in your offer
- Consider skipping the agent — for experienced buyers in straightforward transactions, purchasing without a buyer agent and negotiating directly can save 2%–3%
The 2024 NAR settlement changed who pays buyer-agent commissions — see real estate agent commission for the full breakdown of how commissions are now structured. Sellers exploring cost-saving alternatives should review selling a home without a real estate agent. For what an agent actually does during a transaction, see what does a real estate agent do.
The content on Wealthvieu is for informational purposes only and should not be considered financial, tax, or investment advice. Consult a qualified professional before making financial decisions. Full disclaimer · Editorial policy