How buying a central Ohio home could change this summer

COLUMBUS, Ohio (WCMH) -- The way a home is sold in central Ohio could change this summer after the leading national real estate trade group settled a series of lawsuits and agreed to alter how agents are paid commissions.

The National Association of Realtors reached the settlement this month with home sellers who argued the current way commission prices are negotiated forced them to pay excessive fees. Now, the association will pay $418 million in damages and implement a new rule banning a seller's agent from offering to compensate a buyer's agent through the Multiple Listing Service, a database of homes for sale.

Columbus Realtors announced that the organization will follow the new rule set by NAR's settlement, which is still subject to court approval. Scott Hrabcak, president of Columbus Realtors, said the rule will be enacted in mid-July for the organization's more than 9,000 central Ohio agents.

"I am confident that today's announcement from NAR provides some clarity and gives us a positive path forward," said Hrabcak. "The goal has always been to promote access to home ownership, and Columbus Realtors leadership is dedicated to seeing this through while providing an exceptional home-buying and selling experience for our consumers."

The new rule could end the current practice of a home seller paying the commissions for both their agent and the buyer's agent. Typically, if each agent receives a commission of 3% of the sales price, a seller would pay $12,000 -- $6,000 to each agent -- for their home that sold for $200,000.

Now, an agent who is representing a buyer will be required to have a written agreement with their client outlining their compensation, instead of relying on sellers to cover the cost. Columbus Realtors said the organization will also adopt this change in mid-July.

While the new process bans compensation offers from being communicated through the MLS, home sellers could still offer compensation to the buyer's agent through negotiations with their agent, Columbus Realtors said.

While NAR denies agents inflated costs while negotiating through the MLS, Nykia Wright, Interim CEO of NAR, said the settlement "provides a path forward for our industry, which makes up nearly one fifth of the American economy."

"This will be a time of adjustment, but the fundamentals will remain: buyers and sellers will continue to have many choices when deciding to buy or sell a home, and NAR members will continue to use their skill, care, and diligence to protect the interests of their clients," said Wright.