The real estate industry will undergo some policy changes starting Aug. 17. It's a result of a $418 million settlement by the National Association of Realtors (NAR) earlier this year. The NAR continues to deny any wrongdoing.
The new rules will impact homebuyers and sellers, as well as realtors across the United States.
According to the NAR website, one of these policy changes will remove compensation offers off a Multiple Listing Service (MLS).
"Offers of compensation could continue to be an option consumers can pursue off-MLS through negotiation and consultation with real estate professionals. And sellers can offer buyer concessions on an MLS (for example—concessions for buyer closing costs)," according to the NAR website.
Compensations will be required to be discussed up front. Additionally, homebuyers who want to see a house with a realtor must first sign a buyer's representation agreement.
"That agreement could be for one house or for one hour, or it could be a more extensive agreement that leverages all of the homes [the buyer] is going to tour with the specific realtor," said Jef Conn, the current chairman of Texas Realtors.
Changes to this process are expected to lead to more transparency.
"What it will do is open up the communication about how buyer's agents are paid, whether that's paid by the seller or other negotiated way," Conn said. "The important thing to remember is commissions were negotiable before this settlement. They're still going to be negotiable after, so make sure you talk to your realtor about how they will get paid and what that looks like."