NAR & MLS Rules

On March 15, 2024, NAR announced a proposed settlement agreement to end antitrust litigation brought on behalf of home sellers related to broker commissions. As part of the settlement, NAR agreed to make several policy changes which have been incorporated into mandated MLS rules. These new rules affect offers of compensation on an MLS and include specific requirements for disclosures and written agreements.

Offers of compensation from sellers or listing brokers to buyer’s brokers cannot be included anywhere on an MLS platform. Any platform that uses MLS data cannot display offers of compensation from multiple brokers.

Listing brokers must disclose to sellers and obtain seller approval for any payment or offer of payment that the listing broker or seller will make to another broker acting for buyers. This disclosure must be in writing and provided in advance of any payment or agreement to pay and must include the amount or rate of any such payment.

MLS participants must disclose to sellers and buyers that broker commissions are not set by law and are fully negotiable. This disclosure must be contained in listing agreements and buyer representation agreements.

MLS participants working with a buyer must have a written agreement with the buyer before touring any home.

1. Working with a buyer” means providing brokerage services to a buyer, such as identifying property to purchase, arranging showings, and negotiating offers. Listing agents and subagents do not have to get written agreements to show their own listings because they are not working with a buyer; they are representing the seller.
2. “Touring a home means” when the buyer and MLS participant enter the house. This includes when the MLS participant enters the home to provide a live virtual tour to a buyer not physically present. In Texas, we call this “showing” a home.
3. A “home” means a one-to-four family residential property.

The written agreement with a buyer must contain three specific provisions:

1. The agreement must disclose the amount or rate of compensation the REALTOR® will receive or how this amount will be determined.
2. The amount of compensation reflected in the agreement must be objectively ascertainable and may not be open-ended. For example, it can’t say, “compensation will be whatever amount seller is offering”
3. The MLS participant may not receive compensation for brokerage services from any source that exceeds the amount or rate agreed to in the agreement.

Note: The required contractual provisions have been made to the applicable Texas REALTORS listing and buyer/tenant representation agreements.