With preliminary approval of NAR’s deal and a new settlement proposal from HomeServices of America, can we finally all get back to business?
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Each week on The Download, Inman’s Christy Murdock takes a deeper look at the top-read stories of the week to give you what you’ll need to meet Monday head-on. This week: With preliminary approval of NAR’s deal and a new settlement proposal from HomeServices of America, can we finally all get back to business?
It feels like we’ve been in limbo since the very scary Halloween when the Sitzer | Burnett verdict came down. It’s been a blur of copycats and settlement proposals ever since, consuming agents’ attention while they’re also battling high interest rates, low inventory and ever-dwindling consumer confidence.
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However, the last week felt a little different. A little more positive. A little forward momentum. Maybe it’s because spring has sprung in most of the country. Maybe it’s because people are getting used to the state of things.
Or maybe, just maybe, we’re turning a corner and getting ready to get back to business.
One of the caveats in the aftermath of NAR’s settlement has been the fact that the settlement might yet fall through. Now, however, Judge Stephen R. Bough, who presided over the landmark Sitzer | Burnett class action lawsuit, has granted preliminary approval to the proposed settlement reached last month, making it more likely that Realtors will operate under new rules within just a few months.
Bough ruled that the sweeping changes proposed within the settlement agreement were “fair, reasonable and adequate” and set a November hearing for final approval.
Subsequently, the same judge merged two major similar suits filed in his court challenging the current U.S. commission structure and aiming to represent millions of homesellers nationwide.
EXTRA: Sitzer | Burnett judge consolidates 2 nationwide commission suits
Bough approved a motion to consolidate the cases, known as Gibson and Umpa after their lead plaintiffs. The Sitzer | Burnett plaintiffs’ attorneys filed Gibson on Oct. 31, minutes after a jury in Sitzer | Burnett awarded $1.78 billion in damages to a class of approximately 500,000 Missouri homeowners after finding the NAR and major real estate franchisors had conspired to inflate broker commission rates paid by homesellers.
Friday mornings have become prime time for new news on the commissions and settlements, and this week was no exception as we learned that HomeServices of America, among the largest real estate brokerages in the nation, will pay $250 million and enact changes to its business practices as part of an agreement to settle lawsuits that posed an ongoing threat to the firm.
EXTRA: HomeServices of America agrees to pay $250M to settle lawsuits
HomeServices is the last major brokerage named in the landmark Sitzer | Burnett class action lawsuit to reach a settlement agreement, following Anywhere Real Estate and RE/MAX in September, Keller Williams in February and the National Association of Realtors last month.
The stakes were immensely high for HomeServices, which was potentially on the hook for the remaining $4.7 billion in damages from an Oct. 31 jury verdict in Sitzer | Burnett, which awarded plaintiffs $5.3 billion. The jury awarded $1.78 billion, an amount that automatically triples.
You could practically hear the sighs of relief this week, as Inman readers threw themselves into stories about answering questions and meeting with clients — you know, the real stuff. So like most springs, markets and marketing are now on everyone’s mind as agents once again pivot toward a new normal and learn how to navigate the new rules of the road on behalf of their clients.
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Christy Murdock is a freelance writer, coach and consultant and the owner of Writing Real Estate. Connect with Writing Real Estate on Instagram and subscribe to the weekly roundup, The Ketchup.