Law Information Made Easy

Will the NAR Settlement in the U.S.A. Eliminate Buyer’s Realtor’s in Canada?

By Kormans LLP

A proposed settlement agreement has been reached with respect to a class-action lawsuit that was filed in the Missouri federal court by a group of home sellers against the National Association of Realtors (NAR) and other defendants. The Plaintiffs claimed that real estate commission rates are too high, buyers’ representatives are paid too much, and NAR’s Code of Ethics and MLS Handbook, along with the corporate defendants’ practices, lead to inflated commission rates.

Pursuant to the settlement NAR agreed to pay $418 Million over approximately four years. The settlement is subject to court approval which is expected to take several months or more. In addition, the settlement requires practice changes including decoupling of commission fees so that commissions will no longer bundled – i.e. the standard 6% split between the buyer’s and seller’s realtors. NAR will transition to a structure where each realtor’s commission is distinct and not inherently linked.

Consumers will continue to have the right to cooperative compensation as an option so long as they pursue it off-MLS through negotiation and consultation with real estate professionals.

There are many ways in which buyer realtors could be compensated, including through offers of compensation communicated off MLS, including but are not limited to:

  • Fixed-fee commission paid directly by consumers
  • Concession from the seller
  • Portion of the listing realtor’s compensation

The impact of the NAR settlement in Canada is now being analyzed in each Province and by all brokerages and realtors. There is an evolution going on in the industry. To some degree the recent enactment of the Trust in Real Estate Services Act (TRESA) in Ontario anticipated part of this evolution.

The lawyers at Kormans LLP are continually monitoring this development and are happy to assist you with any questions that you may have on this blog, or any other legal inquiries that you may have. Please email us at or call (905) 270-6660.

Join our newsletter and don’t miss out on a blog post!

David H. Korman is the Managing Partner at Kormans LLP. His practice areas include residential and commercial real estate transactions, commercial leasing and private and institutional lending. You can reach David at

The information and comments herein are for the general information of the reader and are not intended as advice or opinion to be relied upon in relation to any particular circumstances. For particular application of the law to specific situations, the reader should seek professional advice. Kormans LLP cannot be responsible for the content of other sites. We expressly disclaim all liability with respect to actions taken or actions not taken based on content received from a third party website linked, directly or indirectly, to that of Kormans LLP.  The link to another site is not to be construed in any way as an endorsement of the host, the site or the information contained therein, nor is such link to be inferred as an association or affiliation with the host.