Keller Williams Reaches $70 Million Settlement Over Real Estate Commissions  – Forbes Advisor – Technologist

Keller Williams Realty has agreed to pay $70 million to settle antitrust claims after a jury found last year that it conspired with other real estate brokers to force home sellers to pay inflated commissions to buyers’ agents.

Several other real estate companies and the National Association of Realtors, known as NAR, were also found liable in the multistate class action lawsuit.

Texas-based Keller Williams, which has more than 180,000 agents, admits no wrongdoing in the proposed settlement, which was filed Thursday in federal court in Missouri. The deal still needs to be approved by a judge.

Keller Williams is the third real estate company named in the suit to agree to a settlement. RE/MAX and Anywhere Real Estate earlier agreed to pay a combined $138.5 million.

Widespread Complaints About Commissions Sparked Lawsuit

In 2019, home sellers in Missouri, Kansas and Illinois sued the NAR—the nation’s largest professional organization of real estate brokers—along with select real estate companies. The plaintiffs claimed that forcing a home seller to pay a nonnegotiable commission to the buyers’ agent is a violation of the federal Sherman Antitrust Act.

The court agreed, and in October 2023, a Kansas City, Missouri, jury awarded home sellers almost $1.8 billion in damages. In post-trial negotiations through a mediator, Keller Williams hammered out its $70 million settlement with the plaintiffs .

The NAR and HomeServices of America have so far refused to settle. They plan to appeal the verdict.

Real Estate Companies Promise To Change Business Practices

In their agreements, the firms that have settled have promised to change their business practices. They say they will make it clear to franchisees that sellers do not have to pay a commission to buyers’ agents, and they will not require agents to be members of the National Association of Realtors, among other things.

What Does This Mean for Home Sellers?

The cases could lead to big changes in how buyers’ agents are paid, leading to savings for home sellers.

If you’re getting ready to sell, do your homework before you hire an agent. Be sure you read a prospective listing agreement carefully to understand how both the listing agent and the buyer’s agent get paid. The listing agreement will spell out if and how your seller’s agent will share the commission with the buyer’s agent.