Buyer Agent Commission After the NAR Settlement: What FSBO Sellers Need to Know

The 2024 NAR antitrust settlement changed the rules around buyer agent commissions in a way that directly affects every FSBO seller. Understanding what changed — and what it means for your specific situation — determines how much of your equity you actually keep.

What Changed in August 2024

Before the settlement, the standard practice in US real estate was for sellers to offer a buyer's agent commission (typically 2.5%–3%) displayed directly on the MLS. Buyer's agents used this to filter and prioritize showings — a property with no commission offer was frequently deprioritized or skipped entirely in favor of properties offering competitive commissions.

The settlement implemented in August 2024 changed two things:

1. MLS platforms are now prohibited from displaying buyer agent compensation. Offers of buyer agent compensation can no longer appear on any MLS listing. If you want to offer a buyer's agent commission, that offer happens off-MLS — directly between you and the buyer or their agent.

2. Buyers must sign a written representation agreement before touring any homes. This agreement outlines what the buyer's agent will be paid and by whom. Buyers are now explicitly aware of what their agent costs, and they're legally bound to pay it if the seller won't.

What This Means for FSBO Sellers

Before August 2024, not offering a buyer's agent commission practically guaranteed your listing would be skipped. Now, the MLS can't even display commission offers — the playing field has shifted.

For FSBO sellers, this creates a genuine strategic choice rather than a forced default.

Option 1: Offer 0% buyer's agent commission

You pay nothing to the buyer's agent. The buyer is responsible for compensating their own agent under the terms of their representation agreement.

Potential upside: maximum net proceeds from the sale. Potential downside: buyers who can't afford to pay their agent out-of-pocket (especially first-time buyers using FHA or low-down-payment loans) may be unable to afford your home if their agent's fee adds to their total cost. Some agents may still deprioritize zero-commission listings, though this is harder to do systematically now that commissions aren't listed on the MLS.

Option 2: Offer a flat dollar amount or percentage off-MLS

You negotiate directly with each buyer's agent who contacts you. You agree — or don't agree — on a commission for their buyer, formalized through an addendum to the purchase agreement.

A flat dollar figure ($3,000–$7,000) is increasingly common as an alternative to a percentage, particularly in higher-price markets where 2.5% of a $700,000 home is $17,500 — a figure sellers are less willing to offer in a competitive market.

Option 3: Offer buyer closing cost concessions instead of commissions

Instead of paying the buyer's agent directly, you offer the buyer a credit toward their closing costs at settlement. The buyer uses that credit to pay their agent. This is functionally similar but structured differently in the purchase agreement — and it may work better in situations where the buyer's agent has a signed agreement requiring the buyer to pay them a specific amount.

Option 4: Offer traditional 2%–2.5% off-MLS

In slower markets or with properties that have sat for more than 3–4 weeks, offering a traditional buyer's agent commission remains the most reliable way to keep buyer's agents engaged and showing the property. The commission is documented in a compensation agreement or in the purchase agreement addendum, not on the MLS.

How Buyer Agent Commission Negotiations Actually Work Now

When a buyer's agent contacts you about your FSBO listing, they will typically ask about your commission offer before scheduling a showing. This is now a direct conversation between you and the agent.

Be prepared to answer:

• "Are you offering any buyer's agent compensation?"
• "What is your policy on buyer concessions?"

Your answer should be specific and consistent. Vague responses ("it depends" or "we can talk about it") signal inexperience and weaken your negotiating position.

If you've decided to offer 0%: "We're not offering a buyer's agent commission. Your buyer is welcome to tour the property — please confirm their representation agreement covers your compensation."

If you're offering a flat fee: "We're offering a $4,000 buyer's agent fee, to be formalized in the purchase agreement."

If you're market-testing 0% first: "We're not currently offering a buyer's agent commission, but we're open to including concessions in the purchase agreement for competitive offers."

The Financial Analysis

On a $400,000 home:

• Traditional listing agent + buyer's agent commission at 5.5%: $22,000
• FSBO with 2.5% buyer's agent commission: $10,000 + ~$1,000 FSBO costs = $11,000 total
• FSBO with 0% buyer's agent commission: ~$1,000 FSBO costs total

The question is whether offering 0% costs you in sale price or days on market. In a seller's market with low inventory, you have leverage. In a buyer's market, refusing to compensate buyer's agents risks extending your days on market significantly — and properties that sit accumulate a price stigma that frequently results in sale prices below what a commission-offered listing would have achieved.

The right answer depends on your local market conditions, your timeline, and your buyer pool. Properties targeting move-up buyers with significant equity tend to attract buyers who can absorb agent fees. Properties targeting first-time buyers or buyers stretching their budgets tend to attract buyers who need seller concessions to close.

What Hasn't Changed

Agent steering — where buyer's agents deprioritize listings based on commission — hasn't disappeared. It's just harder to systematize. Individual agents still have discretion over which properties they show and recommend. Offering some form of buyer agent compensation (cash or closing cost credits) keeps you in consideration for the full buyer pool.

The requirement to disclose material facts, complete seller disclosures, and execute legally valid contracts is identical regardless of commission structure. The settlement changed compensation mechanics — not anything else about the transaction.

The NAR settlement created real opportunity for FSBO sellers to reduce total transaction costs. Capturing that opportunity requires a clear strategy decided before the first buyer's agent calls — not negotiated on the spot.

The FSBO Complete Guide includes a buyer agent commission decision framework, sample language for compensation addendums, and a script for handling commission inquiries from buyer's agents.