Real estate payouts may drop after settlement with US agents.

The authorization is expected to increase competition in the US real estate market, where a 6% commission on the sale price is considered standard. With the average US home costing $417,700 (£328,000), the standard commission is just over $25,000, a cost that is often passed on to the buyer in whole or in part. In November 2023, a federal jury in Missouri ordered NAR and brokerage firms to pay $1.78 billion (£1.4 billion). Under US antitrust law, these damages could have been trebled by the judge. The case ultimately led to the settlement announced on Friday.

NAR, headquartered in Chicago, says about 1 million of its members are affected by the permit, which is subject to final court approval. The association operates a real estate database called the "multiple listing service," or MLS, and requires home sellers to offer an unchanged commission rate before their properties are listed.

Under the terms of the authorization, which will take effect in July, NAR and real estate companies are not required to plead guilty. Robert Brown, a Chicago attorney representing buyers in two class-action lawsuits against real estate agents, called it "a big change from the previous regulations." "But whether it will actually affect prices in the real estate market remains to be seen," Mr. Brown said in an email. The authorization also does not settle other lawsuits against real estate companies or a possible federal investigation of NAR. Canada is also facing similar litigation over payments for buying and selling real estate.