Last updated on July 13th, 2025 at 05:46 am
After the settlement in August 2024, NAR revolutionized real estate transactions in the United States. Historically, sellers paid the listing and buyer agents throughout a co-op commission arrangement; buyers are finally made responsible for their agent’s fees, hence making the market more transparent but perhaps trickier.
The infographic lays out exactly what changed and who now pays for what and how these rules influence your home buying strategy.
Changes like these are paramount to help you navigate the real estate market, whether for the first time or as an experienced investor.
What the new NAR Law Changed
Understanding the New NAR Settlement Changes
Major Changes Effective August 2024
The National Association of Realtors (NAR) $418 million settlement has fundamentally changed how buyer’s agent fees are handled
Before vs. After NAR Settlement
• Total commission (~5.46%) split between agents
• Buyer’s agent fee automatically included
• 86% of transactions followed this model
• Buyers rarely negotiated directly with their agents
• Buyer representation agreements required
• Commission no longer automatically shared
• Buyers responsible for their agent’s fee
• More transparent fee negotiations
Who Pays Now?
Primary Responsibility: THE BUYER
- Buyers must sign representation agreements before viewing homes
- Fee amount and structure must be negotiated upfront
- Buyers can still negotiate for seller to cover the cost
- Payment can be rolled into mortgage (with lender approval)
- Cash payment at closing is also an option
Different Scenarios
What This Means for Buyers
Action Items
- Budget for potential agent fees (typically 2-3% of purchase price)
- Negotiate fee structure before starting home search
- Consider fee as part of total purchase negotiation
- Understand your representation agreement completely
- Shop around and compare agent fees and services
