TAMPA, Fla. — A recent antitrust court case in Missouri, along with similar lawsuits, may bring about changes to the standard 6% commission paid to real estate brokers, along with who is responsible for paying that fee.
Callen Jones of Jones Home Team Inclusive Real Estate is a Florida real estate agent who says they are already seeing the impact of that verdict locally.
Throughout their career, Jones has printed out thousands of pages of documents.
“So this is the listing agreement,” Jones said.
The Florida real estate contract lays out the terms and conditions between a buyer and seller for the transfer of property.
“So it talks about the address and types of loans they will accept,” they said.
The contract specifies details about the commission. Real estate agents usually charge 5-6% of the sale price, and the seller pays the entire commission.
“Part of that percentage is going to the agent who would be bringing the buyer,” Jones said.
Jones says the landmark lawsuit could lead to changes in who pays commission rates and how much.
The verdict was in favor of more than 500,000 home sellers who disagreed or were unaware that part of the commission they paid was going to the buyer’s broker.
In October 2023, a jury in Kansas City, Missouri, ruled that real estate commission rates had been artificially inflated. The ruling was a result of a claim that the National Association of Realtors, HomeServices of America, and Keller Williams Realty had conspired to maintain the inflated rates. The judgment amounted to $1.8 billion.
“It’s huge!,” Jones said of the case. “Because we have this lawsuit. We have additional copycat lawsuits. Essentially, we don’t know what is going to happen.”
As of October, the compensation offered to a buyer agent in the MLS (multiple listing service) will no longer have a minimum value of $1.00. Instead, it is now $0.
“The perception has changed,” Jones said. “Sellers feel like they have more chances to choose. On the flip side, if you are a buyer’s agent, you now can’t guarantee that the seller is going to pay your commission.”
Jones says it is changing how seller and purchase agreements have been done.
“You have to go back many decades on why commissions were formed this way because they wanted buyers to have their own representation," they said. "If one real estate agent represents both parties — you cannot equally represent the interest of everybody.”
Jones says veterans and first-home buyers will pay the ultimate price.
“We are in a market with a military base. We have a lot of folks, either military or veterans, who use a VA loan,” Jones said. “The VA loans state that they cannot pay commission. So if a VA buyer is interested in a house and they’re not offering commission, well now what?”
Jones says that since home prices are up, it’s also unlikely that some buyers will be able to afford down payments, closing costs and now commission.
“You could work for all those months and not get paid in the end,” Jones said.
Jones also said that realtors will also lose on compensation, which they say is guaranteed to upend the real estate industry.
Meanwhile, the real estate lobbying group National Association of Realtors says it plans to appeal the ruling.