Real estate commissions are expected to drop by double digits, according to housing industry analysts, after the National Association of Realtors agreed to drop their standard 6% commission on home purchase transactions. #realtor #commission #realestate

This amounts to a once in a century earthquake for the housing market, and a lot of our viewers are going to feel the aftershock. So, here's what happened. The National Association of Realtors and Brokerages had been accused by home sellers of keeping commissions high, artificially high. The NAR has agreed to settle those claims, and the settlement effectively ends the 6% commission as we know it. Now, 6% has been standard here in the United States for a while, but it's actually pretty high. When you look overseas, a lot of countries, they only have a commission of around 3%, or sometimes as low as 1%. And these fees, they really add up. Americans spend $100 billion on real estate commissions every single year. Now, this settlement really sets the stage for some big savings for home buyers and home sellers. And of course, this comes at a time when we know home buyers could really use the help, right? We have record high home prices. $379,000 is the medium price home as of January. That's up by 42% since before COVID. And what you don't realize is that you have to also account for real estate commissions. And when you factor that in at 6%, that really adds up. You're talking about $23,000 in real estate commissions, and that's baked into the price. So, high commissions actually helps to contribute to high home prices.