Here’s the news: To get out from under the many lawsuits plaguing it, the NAR has elected to do away with its entire reason for existence – the cooperating broker’s compensation.

You know of it as the buyer’s agent’s commission, and, unbeknownst to practically everyone, it is the “why” of the MLS idea as such.

Ideally, my office has enough buyers to match up with my sellers, so I don’t need to leave the walled garden of my own brokerage to clear my inventory.

But nothing is ever ideal, so when I need a buyer that I can’t find on my own, I turn to the MLS to appeal to other brokers to bring me that buyer, offering them a split of my sales commission as incentive.

Note well: It is the listing broker, not the seller, who is paying the buyer’s broker’s commission – even though he might rather have kept everything in-house.

Under the new rules announced Friday, an MLS listing will continue to elicit cooperation, but it can no longer promise compensation.

Buyer’s agents can show houses, but they may not know how – or even if – they will be compensated.

Accordingly, they will either appeal to their typically cash-strapped buyers for their pay, or, more likely, buyers will either go unrepresented or their agent will also be the seller’s agent – just like the bad old days.

Worse for the NAR, there is no longer any reason to prefer the MLS to Zillow. That’s where the buyers are seeing my listings, and not only can I promise compensation there, I am free from every other arbitrary MLS rule.

The NAR uses the golden handcuffs of the MLS to keep its membership ensnared. But with free-market forms and third-party lockboxes, and with no particular advantage to listing by MLS, there is no reason for agents to stay in the NAR – paying for its legal blunders.

Meanwhile, sellers: Be wise. The commission is a marketing fee. You pay it because you net more at Close of Escrow for having had professional marketing. Stiffing the half of the marketing team who is bringing the money to the table is penny wise, pound foolish.


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