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ARTICLE · 21 NOVEMBER 2023

Residential Brokerage Commissions - A Seismic Shift?

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Several days ago, a class action lawsuit (March vs Real Estate Board of New York et al.) was filed against the Real Estate Board of New York (REBNY) and over a dozen other real estate brokerages operating in New York City.

United StatesReal Estate and Construction
Vasiliki Yiannoulis
Vasiliki Yiannoulis
Jeffrey Lederman
Jeffrey Lederman
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Several days ago, a class action lawsuit (March vs Real Estate Board of New York et al.) was filed against the Real Estate Board of New York (REBNY) and over a dozen other real estate brokerages operating in New York City. The lawsuit comes on the heels of a similar case (Sitzer et al. vs. National Association of Realters et al.) filed in the State of Missouri against the National Association of Realtors (NAR) and other brokerage firms, in which the jury issued a late October 2023 ruling for the plaintiffs.

Why is this important, you might ask? At stake is the brokerage commission system that is commonplace in most residential transactions throughout the United States. In most jurisdictions nationwide, the default practice in residential arms-length transactions is that the seller of real property will (at closing) pay the seller's broker a commission of between 5-6% of the purchase price, which is then split between the seller's broker and the buyer's broker, in

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