Published July 15, 2024

Dear Members of the Dutchess County Association of REALTORS

I hope this message finds you well. My name is Isabel Alves and I am the 2024 President of the Dutchess County Association of Realtors.

As many of you are aware, the settlement of the Sitzer & Burnett lawsuit with the National Association of Realtors (NAR) marks a significant turning point in our industry. This case has brought about substantial changes that will change the landscape of real estate transactions and practices.

The lawsuit primarily challenged certain commission structures and practices that were deemed to potentially restrict competition and transparency within the industry. As a result of the settlement, several critical modifications have been instituted to ensure greater fairness, transparency, and consumer protection in our business operations.

 

These changes will affect various aspects of our daily activities, from how we present commission structures to clients, to the way we negotiate and disclose fees. It is imperative that all members of our association understand and adapt to these new regulations to maintain compliance and uphold the highest standards of professional integrity.

Key changes are:

• MLS is prohibited from displaying any offers of compensation to cooperating brokers.
• Sellers mays still offer cooperating compensation to a cooperating broker, just not through MLS.
• Brokers may advertise compensation to a cooperating broker on the brokers own website.
• Listing agreements with a seller and buyer agreements with a buyer must contain a conspicuous statement that broker fees and commissions are not set by law and are fully negotiable.
• Written buyer agreements must also contain specific provisions pursuant to the settlement.
• MLS participants will be required to have a written agreement when representing a buyer.  This includes buyer agency, dual agency, and dual agency with designated sales agents.

In addition, the settlement has specific requirements for what needs to be in the written buyer agreement.  Pursuant to the NAR Settlement FAQ’s the following must be included in the written buyer agreement:

• A specific and conspicuous disclosure of the amount or rate of compensation the Participant will receive or how this amount will be determined, to the extent that the Participant will receive compensation from any source.
• The amount of compensation in a manner that is objectively ascertainable and not open-ended.
• A term that prohibits the Participant from receiving compensation for brokerage services from any source that exceeds the amount or rate agreed to in the agreement with the buyer

If a buyer refuses to sign the buyer agreement, the MLS participant would be in violation of the MLS policy requiring a written agreement and would be subject to discipline from the MLS.

 

In the packet below, we will delve into the specifics of the settlement, outline the key changes, and provide guidance on how we can smoothly transition into this new era of real estate practice.

We recently hosted a virtual Legal Update lunch and learn for all of our realtor members to attend. NYSAR’s legal counsel Anthony Gatto gave a comprehensive presentation on the settlement. If you missed this event, a link to the recording is below.

This week, we will be hosting a meeting for all brokers and managers to review all of these changes.

Our goal is to equip each of you with the necessary knowledge and tools to continue delivering exceptional service to our clients while adhering to the updated guidelines.

 

We are committed to supporting you through this transition and will continue to offer you training, classes and resources to address any concerns or questions you may have. Together, we can navigate these changes and continue to thrive in our evolving industry.

Thank you for your attention and dedication to maintaining the excellence of our profession. Have a great day.

 

Sincerely,

Isabel Alves

2024 President

Dutchess County Association of REALTORS