Is the era of the all-powerful real estate agent over?
The spring home selling season is about to open, bringing with it a steeplechase of complications for buyers. But it also brings a massive power shift.
“I don’t know how much buyers are aware of the new power they hold,” Summer Goralik, an independent consultant to the industry on topics of legal compliance, told Straight Arrow News.
These new stakes abound in the wake of a late 2023 legal ruling that re-ordered how commissions are structured and communicated. Now, buyers can exercise new control to negotiate how much they pay the agents who represent them, potentially saving money.
More than just a buyers’ market
North Carolina mortgage broker Michael Carter deals with confused buyers all day long, forcing him to explain what’s new and different.
Seasoned homeowners can’t rely on prior experience, as fundamental aspects of the broker commission structure have changed, he told Straight Arrow News in an interview. New buyers face daunting rounds of negotiations to ensure their best interests are truly represented. And everyone must grapple with the ways that the new rules ripple through mortgage lending, Carter said.
One key change for buyers, according to Goralik: Agents must now discuss compensation before they embark on house hunting with potential clients.
“So much of that was behind closed doors before. For years and years, buyers and agents never talked about compensation,” she said. “Never.”
In the past, sellers paid a commission to a property’s listing agent, a required step to get it into the all-important multiple listing service, which feeds listings to powerhouse platforms like Zillow, Homes.com and regional listing services. Behind the scenes, in a section of the listing not visible to the public, listings included the commission offered to agents.
Traditionally, the total commission was — and remains — about 5% to 6%. Half of that went to each broker, which in turn split their shares between the brokerage and the agents who handled the sale. So, a 5%, $10,000 total commission on the sale of a $200,000 house would deliver a $2,500 payday to each broker and agent involved.
Technically, the total commission, and how it was split, was always negotiable, the National Association of Realtors has insisted in numerous public statements. But a group of Missouri homeowners filed suit on the basis that they were coerced into paying artificially high commissions by listing agents. The Missouri homeowners objected to the fact that agents agreed beforehand, in writing and in the multiple listing service forms, what the commissions would be and how they would be split among listing and buyers’ agents.
In October 2023, they won. By summer 2024, the Sitzer/Burnett decision rippled through the home selling and buying process. One new rule requires buyers who want to engage an agent to pay the agent even if the seller won’t. That means that if the seller pays only their own agent, the buyer must pay their agent separately. The only exception covers open houses, where buyers may tour a house without a commitment to an agent. But if a buyer wants to pursue the house, they must either proceed with an agent contracted on their behalf, or formally agree to forgo agent representation.
Residential brokers and agents are becoming more confident in asserting the new rules.
In late 2025, a Florida broker, Echo Fine Properties, pursued a civil case against a client that had been working with Echo Fine, then bought a house with a different buyer’s agent. Echo Fine went after the $25,000 commission it didn’t get, and won. The case has bolstered brokers’ and agents’ determination to ensure buyers take the new rules seriously.
Buyers in the driver’s seat
Going into the spring selling season, buyers have plenty of power to negotiate in all directions. A new survey from Redfin, the national residential real estate brokerage, found that nationally, there were 47.1% more home sellers than buyers at year-end — up 22.2 percentage points from the end of 2024. In December, according to the NAR, pending home sales dropped 9.3% from November — a daunting indicator for market momentum.
The buyer’s market is slowing the transition to a new default of negotiated commissions. For the moment, buyers have the clout to dictate that sellers pick up the cost of both agents involved in the transaction.
Two things will change that, Amanda Orson, founder and CEO of home selling marketplace and data platform Galleon, told SAN. First, when the market becomes more balanced, both buyers and sellers will have power and motivation to negotiate commissions. Second, as more people become conversant with the home buying and selling process, they’ll gain confidence that they can handle some or all of it on their own and consequently save money, she said.
“You’ll see the 5% to 6% commission decay over time,” Orson told SAN. After all, the process is highly regulated and standardized — in some ways, comparable to filing an income tax return, Orson said.
“The difference is that it’s low-frequency and high stakes,” she said. “That’s why people are scared. For people who have frequency, they’re not scared.”
Workarounds abound
Simply paying a buyer’s agent a flat fee or, say, 1% of the purchase price, isn’t as easy as it sounds, Carter said. Most buyers take out mortgages and traditionally, the commission was integrated into the loan amount. But if the buyer’s agent is paid outside the commission structure, the buyer must come up with that money on their own, he said, or get creative.
“The structure of the loan can be adjusted to cover the cost of the buyer’s agent,” he said. For instance, a seller could cover the loan “points,” a fee that lenders typically charge, and indirectly offset the cost of a direct compensation to the agent.
Buyers’ agents have had to fine-tune the justification for their services. After all, there’s nothing to prevent buyers from representing themselves, and sellers’ agents are supposed to bring all legitimate offers to their clients. Some brokerages require an unrepresented buyer to sign an acknowledgement of that before they can work with the listing agent to tour a house.
Some buyers tiptoe through the process, signing agreements with agents to represent them for a single property or for a short period of time, said Andi DeFelice, who owns Exclusive Buyer’s Realty, in Savannah, Georgia. Her brokerage belongs to an industry group, the National Association of Exclusive Buyer’s Agents.
One danger zone: so-called “dual agency,” in which one agent represents both the seller and the buyer. Dual agency allows agents to claim both sides of the commission, potentially offering a discount to both parties to sweeten the deal. But it also is ethically suspect, said DeFelice, as neither the buyer nor the seller has an agent wholly devoted to their interests.
“If I was an active buyer I would never work with a dual agent,” said Goralik. “How can one be a fiduciary to both sides? It’s impossible.”
For the dawning season, buyers should review buyer’s agent contracts required in the state where they are house hunting, DeFelice advised, and take their time to digest the implications.
“Understand who’s paying for what and how you get out of this agreement,” she said. “Don’t sign it when you’re sitting in front of the house you want to see.”
The post Is the era of the all-powerful real estate agent over? appeared first on Straight Arrow News.
Ella Rae Greene, Editor In Chief
