Judge Grants Final Approval for NAR Commission Lawsuit Settlement

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Commission Lawsuit Settlement

The landmark Commission Lawsuit settlement involving the N.A.R. has officially received final approval, marking a major shift in how real estate commissions will be handled across the country.

On Tuesday, Judge Stephen Bough of the U.S. District Court in Kansas City granted final approval to the National Association of Realtors® (N.A.R.) settlement, alongside agreements with HomeServices of America and various MLSs and brokerages. This Commission Lawsuit settlement, which includes a $418 million payout and changes to business practices, aims to address concerns over inflated commission fees that have been a point of contention for years.

Despite some last-minute objections from the Department of Justice—which raised concerns over mandatory buyer broker agreements—the Commission Lawsuit settlement passed. This ruling solidifies changes that took effect in August, including the removal of compensation offers from MLSs and new requirements for buyer representation agreements before home tours.

The Commission Lawsuit has garnered widespread attention due to its potential to reshape the real estate landscape. N.A.R. members are now tasked with implementing these new practices, which aim to increase transparency and competition in the market. With nearly half a million claims already filed, this Commission Lawsuit settlement is expected to affect agents, buyers, and sellers nationwide.

In an email sent to members Tuesday, NAR President Kevin Spears wrote, “NAR’s goal throughout this process was to protect as many NAR members and their businesses; state, local, and territorial associations of REALTORS®; and multiple listing services as possible while preserving choice for consumers in their approach to buying or selling a home.” His message emphasized the importance of the changes brought by the Commission Lawsuit settlement.

The Commission Lawsuit settlement not only includes monetary compensation but also enforces key policy changes to address long-standing criticisms. These reforms are expected to enhance consumer choice and adjust industry norms impacted by the Commission Lawsuit.

Real estate professionals are encouraged to stay informed about the ongoing implications of the Commission Lawsuit settlement. For the full details and next steps, keep an eye on updates from N.A.R. and your local MLS. As the effects of this Commission Lawsuit continue to unfold, all stakeholders are urged to adapt to the evolving marketplace shaped by this historic resolution.

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FHFA Raises 2025 Loan Limits Nationwide

The Federal Housing Finance Agency (FHFA) has announced new conforming loan limits for 2025, and they’re going up. For most of the country, the baseline loan limit for one-unit properties will increase to $806,500, marking a 5.2% rise from last year. This adjustment reflects the average 5.21% increase in U.S. home prices from Q3 2023 to Q3 2024, as reported in the FHFA’s House Price Index.

For high-cost areas, where local home values exceed the baseline, the new ceiling loan limit will reach $1,209,750—150% of the baseline. Special loan limits also apply to places like Alaska, Hawaii, Guam, and the U.S. Virgin Islands, where the baseline limit jumps to $1.2 million for one-unit properties.

In total, these new loan limits will be higher in nearly all counties except six, which means more buying power for your clients.

For detailed breakdowns of these new limits by county, check out the full FHFA report online at fhfa.gov

Source: Link

Housing Construction Slows Amid Rising Rates

And finally, despite widespread calls for more construction, the latest housing data paints a stark picture: millions of homes will stay unbuilt.

October’s housing starts and permits dropped to recession-level numbers, with starts falling 3.1% and building permits down 0.6%. These declines highlight the disconnect between policymakers’ housing goals and the reality on the ground.

While Federal Reserve officials, like Minneapolis Fed President Neel Kashkari, have suggested strong housing demand justifies higher mortgage rates, builders are pulling back as rates climb above 6.75%. When rates briefly dipped below 6%, builders showed more confidence, but the market quickly cooled when rates rose again.

New home sales are now lagging behind levels seen during the 2001 tech recession. Builders say a construction boom remains unlikely unless mortgage rates stabilize below 6%, which could reignite building activity. But until then, rising rates will continue to limit growth, keeping many homes off the market.

Experts warn the slowdown could worsen rent inflation, as the housing supply struggles to meet demand.

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