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To say that 2024 was one of the most consequential years in the history of the real estate industry would be no exaggeration.
Real estate had to contend with industry changes in the wake of the commission lawsuit settlements, continued scrutiny from the Department of Justice (DOJ), a reevaluation of established practices like the three-way agreement, challengers to the National Association of Realtors (NAR), alleged bad behavior by powerful players and more.
When considered on its own, any single one of these leading news stories might have made a significant impact in a year of real estate. Taken all together, it has created a year in the industry that has agents looking for stability and guidance.
It’s now time for Inman readers to decide which industry news story was the most consequential of 2024. Vote for your choice in Inman’s Sweet 16 bracket Dec. 16-19 to determine which news made the biggest impact during the last year.
Bracket 1: Commission lawsuits settlement vs. DOJ
“NAR agrees to sweeping changes in $418M commission settlement”
By Taylor Anderson
All eyes were on the National Association of Realtors this year as the association announced its $418 million proposed settlement of the antitrust commission lawsuits that had rocked the industry for the last few years. The settlement, which NAR will be paying out over the next four years, also stipulated a series of industry practice changes that agents, brokers, associations and MLSs had to put into effect by Aug. 17, 2024.
Among them, NAR agreed to not create rules that allow listing agents to set compensation for buyer brokers. The association also created a new rule prohibiting offers of compensation from appearing in the MLS. Buyer brokers who are MLS participants would also be required to enter into a written representation agreement before touring homes.
The terms of the settlement fundamentally changed the way real estate professionals view their roles as salespeople and advisors, and has already started to impact the way in which consumers view the industry, early Inman Intel data shows.
“NAR breaks silence on DOJ call to decouple commissions”
By Andrea V. Brambila
For years, the National Association of Realtors has been at the receiving end of scrutiny by the DOJ. In February, the DOJ made its stance against the cooperative compensation rule very clear in a statement of interest in one of the lawsuits filed against NAR, characterizing the practice as anticompetitive.
Then-interim NAR CEO Nykia Wright issued a public statement decrying “external commentary” that “purported to tell our story for us,” without specifically mentioning the DOJ itself. In the wake of the antitrust lawsuit settlements, NAR ultimately had to decouple commissions, of course. And the DOJ’s influence continues to impact NAR as it now considers whether to amend or abolish the Clear Cooperation Policy.
Bracket 2: NAR vs. American Real Estate Association
“NAR CEO Nykia Wright appears — and disappears — in ‘odd’ new video”
By Andrea V. Brambila
The pressure the association was facing following the resignation of not one, but two presidents began to show in more ways, including in this story that highlighted some of the shuffle happening behind the scenes through a public video featuring CEO Nykia Wright. The video was publicly posted on the morning of Jan. 30, 2024, removed for a few hours, then reposted again — with a slight, but important, modification.”
“[T]he notion that the National Association of Realtors controls what real estate professionals get paid is wholly untrue,” Wright said in the initial video. “NAR does not set commissions. It never has, and it never will. Period, end of story.”
Hours later when the video had been reposted, the key phrase “it never has” had been edited out. Before 1950, it was against the association’s code of ethics to charge less than a standard commission rate, according to a 1983 study by the Federal Trade Commission called “The Residential Real Estate Brokerage Industry.”
The video was also odd because NAR had not been accused in any lawsuits of setting commissions. But the blunder was representative of “the real estate industry’s most powerful trade group in turmoil, fighting scandals, multiple lawsuits, the departure of several high-profile leaders and an investigation by the U.S. Department of Justice,” Inman’s Brambila wrote.
“Umansky says industry is in ‘trouble’ as he debuts NAR rival”
By Jim Dalrymple II
As NAR tried to find stable ground to stand on at the beginning of the year, other major industry players weren’t waiting around for the leadership they felt the industry was lacking.
After first being leaked by The New York Times, The Agency founder Mauricio Umansky debuted an NAR competitor at Inman Connect New York in January that he co-launched this year with Compass’ Jason Haber. The American Real Estate Association, “built by Realtors, for Realtors,” has been accepting new members since August, has two tiers of membership available and now has roughly 5,000 members in 48 states, according to Haber.
Although still young, the association has been making moves to advocate on behalf of its members, launching a petition to end Clear Cooperation and exploring the idea of launching a class action lawsuit over the policy.
The new association’s launch and its garnering of members showed that NAR is not the end-all-be-all when it comes to leadership in the industry and that an appetite for change is in the air.
Bracket 3: Three-way agreement vs. MLS
“Michigan agents and brokers sue NAR due to antitrust settlement”
By Andrea V. Brambila
As real estate industry players have continued to re-evaluate established industry practices, one of the biggest NAR regulations that has now been called into question is the three-way agreement, which stipulates that Realtors must belong to local, state and national associations in order to access their local multiple listing service.
Two Michigan brokers and an agent filed a class-action antitrust lawsuit against NAR and their state and local Realtor associations, claiming that the rule amounts to “economic coercion” and “unfair restraint of trade” that violates the federal Sherman Antitrust Act and the Michigan Antitrust Reform Act. The lawsuit set off a chain reaction of additional lawsuits filed in different states challenging the agreement, representing an overall discontent with the status quo in the industry.
“REcolorado sold to private buyer, cutting ties with Realtor orgs”
By Taylor Anderson
Another big move this year that called into question the nature of the relationship between Realtor associations and MLSs was the sale of REcolorado to a private buyer in September.
The controversial sale, which closed after weeks-long delays and threats between the MLS and some of its subscribers were made public, created a separation between REcolorado’s subscribers and associations affiliated with NAR, offering a model for how other MLSs might separate from Realtor orgs in the future.
REcolorado was sold to MAZL, LLC, a company registered to Joseph E. Burks, president of Equity Title of Colorado and an affiliate member of the South Metro Denver Realtor Association.
Bracket 4: Portals vs. Commissions
“Realtors file suit against Move, NAR over ‘fake leads’ scheme”
By Marian McPherson
Real estate portals turned up the heat in competing with one another this year, with CoStar in particular shelling out major cash to level up its marketing in a bid for the crown. But as competition grew, scrutiny over how portals operate also intensified, with a group of Realtors coming down hard on Realtor.com parent company Move in a class action lawsuit that alleged the company had sold unvetted and fraudulent leads through its websites, including Realtor.com.
NAR and lead generation tech platform Opcity were also named as defendants in the lawsuit for their role in allegedly selling the fake leads. The suit claims that senior execs and other members of management at News Corp, Move, Realtor.com and NAR also knew about agents’ growing discontent with lead quality and “willfully and consciously” ignored the concerns.
On Dec. 10, the defendants moved the lawsuit from LA County Superior Court to federal court because of the suit’s class-action status.
“Consumer watchdog advises buyers to pay agents ‘2% or less'”
By Andrea V. Brambila
Before the Aug. 17 deadline for the industry to implement new practices in the wake of antitrust lawsuit settlements, the Consumer Federation of America released proposed criteria for seller and buyer contracts that suggested buyers pay no more than 2 percent of a home’s sale price to their agent. The guidance challenged the long-held practice of agents aiming to earn 2.5 percent to 3 percent of a home’s sale price in their commission.
The CFA also suggested that the outcome of the class action lawsuit could now, for the first time, “effectively” allow homebuyers to negotiate their agent’s compensation, encouraging consumers to divert from decades-old industry standards, and providing another challenge to the industry.
Bracket 5: Clear Cooperation Policy vs. ‘Justify your commission’
“Reffkin: NAR’s Clear Cooperation breaks ethics code, state laws”
By Robert Reffkin
This fall, most real estate industry executives made their stance on NAR’s contentious Clear Cooperation Policy known. One of the most vocal opponents of the policy to emerge is Robert Reffkin, CEO of Compass. In this widely read opinion piece for Inman, Reffkin argues that CCP forces agents to go against the NAR Code of Ethics and state laws and unduly restricts a consumer’s choice in how their home is sold.
The policy stipulates that agents must list a home on the MLS within 24 hours of publicly marketing it, which can be a turn-off for more private clients, who often turn up in the luxury sector (one of Compass’ areas of specialization). Since Compass has a large national network of agents across the country, it’s easy to see why simply marketing homes within their network would be attractive, to keep sales within the firm. But with the DOJ also investigating the policy, Reffkin also happens to be on the same side of a powerful government agency that is closely watching the industry.
“Communicate value! But how? A step-by-step buyer’s presentation”
By Jimmy Burgess
The NAR settlement has caused agents a lot of anxiety surrounding their commissions, and early data shows that more consumers are questioning their agents’ commissions, too. The key to addressing those doubts about paying a commission to buyers’ agents is proving your worth, industry experts say.
Inman contributor Jimmy Burgess’ step-by-step how-to on showing value in a buyer’s presentation resonated with Inman readers looking for actionable guidance for succeeding in a post-settlement landscape. Adequately providing insights into the home search, loan preapproval and local market dynamics are just a few ways to prove your value, Burgess said.
Bracket 6: Practice changes vs. Workarounds
“Michael Ketchmark: Every move you make, we’ll be watching you”
By Andrea V. Brambila
In advance of major industry practice changes that were put into effect on Aug. 17, real estate professionals scrambled to ensure they had the approved paperwork and new client conversations all lined up. As new contracts in some locales were rolled out, reversed, and rolled out again, it had some agents on edge, wondering if they were truly prepared for the big day.
On top of it all, the seller plaintiffs’ attorneys in the legal battle against NAR and industry players suggested that they would continue to keep the pressure on, and that the industry should be ready for that.
Michael Ketchmark, the lead counsel for plaintiffs in the Sitzer | Burnett case told Inman, “If anyone thinks they’re going to be able to avoid the application of this settlement agreement and the law by creating some new forms or hiding this cooperation on new websites, they’re wrong. If we get any sense that people or corporations are doing that out there as a way around this, we plan on taking swift legal action.”
“Consumer group behind Moehrl flags commission workarounds”
By Andrea V. Brambila
Agents resistant to change in the wake of the NAR settlement who were looking for workarounds to the sunsetting of cooperative compensation had no shortage of ideas for doing so. But the nonprofit Consumer Advocates in American Real Estate (CAARE), which first inspired litigators in the antitrust lawsuits, warned agents that that was a bad idea, and just made them vulnerable to more litigation.
In particular, the group warned buyer agents to avoid withholding home showings in return for a promise of a buyer-broker commission from either a potential homeseller or the listing agent, or to use their fiduciary duty to their homebuyer as an excuse to steer them only toward listings that offer a buyer-broker commission.
Bracket 7: Moves and shakeups vs. Bad behavior
“Marc King steps down as president of Keller Williams”
By Marian McPherson
There were multiple executive-level shakeups in 2024 that made an impact on specific brokerages and were felt in the industry at large.
The move that moved the needle most on Inman’s website traffic was Marc King’s resignation from Keller Williams. The brokerage president had been affiliated with KW for more than two decades and served as president since 2021. King said he was taking time to “put God and family first” after spending years devoting more time to business.
In addition to King, 2024 saw Nick Bailey leave RE/MAX, Josh Team return to the industry with a move to SERHANT., and Howard Lorber and Scott Durkin depart from Douglas Elliman.
“Alexander brothers charged with sex trafficking in fed indictment”
By Lillian Dickerson
Several parties in the real estate industry were hit with lawsuits in 2024 over allegations of sexual assault and sexual harassment, kickback schemes and more. But the most shocking claims were revealed in the final month of the year when once hot-shot luxury broker brothers Oren and Tal Alexander were federally indicted on charges of sex trafficking.
For months, the brothers faced increasing pressure as multiple lawsuits were filed against them, starting last spring, with allegations that included sexual assault, rape and drugging women. The brothers continue to deny the allegations against them, even as dozens of additional alleged victims came forward with claims against them.
As the months went by, their brokerage, Official, began to crumble, they became recipients of an FBI probe, were also sued by their white-label firm, Side, and, on Dec. 11, were arrested for facilitating a “long-running sex trafficking scheme,” according to a federal indictment.
Bracket 8: Economy vs. Brokerages
“Gary Keller says ‘right now, real estate is in a recession'”
By Marian McPherson
On top of all the challenges agents and brokers faced in 2024 with industry lawsuits and practice changes, they also had to grapple with extremely difficult market factors. The Fed continued to tease rate cuts while agents turned blue holding their breath. Inventory remained low as sellers were hesitant to adopt higher mortgage rates, and home prices kept climbing.
During the KW Family Reunion conference in February, KW co-founder Gary Keller told it like it was: “You’re in winter right now, and it’s going to stay winter for a while. If you were hoping this year would give relief, that’s not going to happen … The market isn’t going to give you anything for a little while.”
For 2025, however, hope still springs eternal.
“Former Keller Williams agents sue over profit share changes”
By Andrea V. Brambila
A handful of brokerages introduced or modified their profit-sharing programs in 2024, including Side, eXp Realty and Keller Williams.
But agents at KW did not take too kindly when the company made changes to its program, with three former agents filing separate class-action lawsuits against the franchisor last spring.
In August, KW voted to change its policy so that vested agents who joined the company before April 1, 2020, and “actively compete” with KW brokerages would have their profit share amount cut from 100 percent to 5 percent. The company also sent out letters to those agents impacted by the policy, giving them notice that they had six months to return before their profit share would be cut.
A few months later, KW abandoned its plans to make the profit-sharing changes retroactive, seemingly in response to the backlash they received. Now, those agents who joined the company before April 1, 2020, are still able to collect 100 percent of their profit share amount, even if they go to a competing brokerage. KW and the former agents who sued them reached a settlement to resolve the lawsuits in October.
