As of August 17 Connecticut Realtors were bound by new rules that stem from a $418 million settlement between the National Association of Realtors (NAR) and plaintiffs who alleged that NAR’s commission structure constitute an unfair business practice.
The regulations already went into place in New York on August 8.
“The settlement agreement does not establish new laws,” stressed Carl Lantz, the 2024 President of CT REALTORS® in a prepared statement. “It lays out specific practices that are required to be put in place by REALTORS® and multiple listing services to address specific concerns.”
It was noted that Connecticut Realtors already are subject to requirements that they disclose that commission rates are not set by law and are negotiable, while written agreements have been required since 1996 for buyer brokers.
For those selling their homes, the change requires their agent to get written approval before receiving a payment or charging another Realtor representing buyers. The Realtor will not be permitted to post a commission rate to a Multiple Listing System, but can do so on other platforms.
Buyers on the other hand will be required to sign an agreement with the agent they’re working with prior to touring a home, even if it is a virtual tour. This was already a requirement for Connecticut Realtors, and still does not apply to visiting an open house for a tour. Buyers will also need to be clearly informed of the terms of working with an agent and any expenses a Realtor may be contractually obligated to incur.
“It’s good for everyone to have additional transparency in real estate transactions,” said Alexa Kebalo the CT REALTORS® 2024 First Vice President. “Commissions have always been negotiable and that doesn’t change. Under the settlement agreement, sellers can continue to offer listing broker or seller compensation towards buyer broker professional fees because it can provide the widest pool of potential buyers to consider the purchase. Many first-time buyers and first-generation buyers rely on using the cash they’ve saved towards the downpayment and other closing costs.”
