On The Market

190: Keller Williams Settles for $70M in NAR Lawsuit, Banks “Rocked” by RE Losses

Feb 15, 2024

Keller Williams settles for $70M in NAR lawsuit, potentially changing agent commissions. Banks suffer from real estate losses. Jobs grow, but will rate cuts be affected?

37:16

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Quick takeaways

The settlement of $70M in the NAR agent commission lawsuit indicates a potential shift in broker fees and may lead to more lawsuits, allowing niche brokers with specialized services to thrive in the coming years.

Despite challenges faced by banks due to commercial real estate weaknesses, real estate investors can still find financing, particularly for low-risk residential properties, by building strong relationships with banks and presenting deals with significant equity.

Deep dives

Keller Williams reaches $70 million settlement

Keller Williams, one of the largest brokerages in the country, has reached a $70 million settlement in an ongoing antitrust lawsuit. This lawsuit alleges that NAR and other brokerages conspired to keep their commission structure in place against the best interests of home sellers. The settlement signifies an evolution in broker fees and could open the door for more lawsuits. While the impact may not be felt in the next 12 to 24 months, the industry may undergo changes in the next four to five years, allowing niche brokers with specialized services to thrive.

Introduction

2min

Real Estate Lawsuit Settlement and Implications

12min

High Interest Rates and Ads for Real Estate Companies

3min

Real Estate Losses on Banks and Future of Commercial Lending

8min

Surge in US Job Growth

5min

The Impact of the Job Market on Real Estate

6min

Discussion on Mortgage Rates, Job Growth, and the Need for Stability

3min

Just when you thought the NAR lawsuit coverage was over, Keller Williams agrees to settle for $70M, bringing a big blow to real estate agent commissions. How will this impact buyers and sellers, and are we entering a new age of home buying where only a fraction of the real estate agents exist? We’re getting into this headline and others affecting the housing market in BIG ways in this episode of On the Market.

Some agents will thrive while others barely survive in a post-NAR lawsuit world as real estate agent commissions are threatened once again. But it isn’t only agents getting hit hard this week. Banks have been “rocked” by real estate losses, primarily commercial real estate, as loans come due, but investors aren’t able to pay. One bank saw its share price slide by more than fifty percent this month as earnings reports showed a major loss from lending this quarter.

Finally, it wouldn’t be a headlines show if we didn’t touch on the jobs report. This month, we’re getting a mixed bag of good for the economy but bad for rates type of numbers. Jobs are growing, and the economy is still chugging along, but will this push rate cuts back as the Fed fails to find weakness in our economy? We’re giving you our thoughts on this episode!

In This Episode We Cover:

Keller Williams' settlement of $70M in the NAR agent commission lawsuit and what this means for the future of agent commissions

The rise of “niche” brokers and agents and why they may THRIVE in the coming years

Our crucial advice for first-time homebuyers that you CANNOT miss

Commercial real estate losses and how hard IS it to get an investor loan today? (this will surprise you)

New jobs report numbers that took many economists by surprise and what effect it could have on future mortgage rates

And So Much More!

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