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Since NAR’s settlement of the Sitzer-Burnett lawsuit on Friday, March 15th, there has been persistent inaccurate reporting grossly misrepresenting the realities of the real estate industry. It’s gotten to the point where it can be difficult to differentiate fact from fiction, especially for members of the public who lack knowledge of the benefits of cooperative compensation.

As Arizona Association of REALTORS® staff speaks with members of the association, and as REALTORS® speak with their clients, there are critical points that we all must keep in mind. Finally, please know that the Arizona REALTORS® will be here to communicate each benchmark in the settlement process as we continue working hard on your behalf.

● Reaching this agreement was the right next step for NAR to lead the real estate industry forward. The proposed settlement that NAR announced includes a release of liability that protects over a million members, REALTOR® associations, and many brokerages, and importantly, preserves consumer choice when it comes to compensating brokers.

● The rule at the center of these lawsuits does not set commissions. Compensation for the sale or rental of real property is not, nor has it ever been, set by any Association/Board of REALTORS® or Multiple Listing Service.

● There is no such thing as a standard commission. Each transaction and agent-client relationship is different. Compensation has always been negotiable between agents and their clients and takes many forms such as a percentage, fixed rate, hourly rate, or any other mutually agreed upon arrangement. In Arizona, consumers are fortunate to be able to choose from a number of different business models offered by real estate professionals.

● Cooperative compensation benefits consumers. Sellers use it to attract buyers, which ultimately increases the number of offers they receive, resulting in a higher sales price. And we know that buyers benefit from professional representation in what for many will be the largest and most complex purchase of their lives.

● Even after these new rules go into effect, listing brokers and sellers can continue to offer compensation for buyer broker services, just not communicated via the MLS.

● The settlement provides that MLS participants working with buyers must enter into written representation agreements with those buyers. REALTOR® associations have long encouraged their members to use these written agreements because they help consumers understand exactly what services will be provided, and the cost of those services.

● The Arizona REALTORS®, its workgroups and committees have already begun updating existing forms to comply with the practices mandated by the settlement agreement. New forms are also being considered. The Arizona REALTORS® has met with state lawmakers about potential legislation regarding the mandatory use of buyer representation agreements and is formulating education about the changes and how its members can most effectively discuss compensation with their clients.

● The Arizona REALTORS® will continue to provide the services and benefits its members rely on such as Transaction Desk, Authentisign, Breeze, the legal hotline, the Tech Helpline, professional standards, consumer awareness campaigns, and NAR educational designations and certificates, just to name a few. And this is in addition to legislative advocacy that protects Arizona REALTORS® members’ businesses and clients.

● REALTORS® are advocates for Arizona’s homeowners and taxpayers. They are also primarily independent entrepreneurs who choose to work by a higher set of professional standards.

● Nothing about this settlement changes the Arizona REALTORS® commitment to serving its members. Our mission is, and will continue to be, to enhance our members’ ability to conduct their businesses with integrity and competency and to provide a superior consumer experience. The real estate industry has faced numerous challenges over the years, and your state association will work alongside you to ensure that our profession continues to thrive.