The Housing Market Has New Rules. Realtors Are Evading Them.

Summary

The Daily: The Housing Market Has New Rules. Realtors Are Evading Them. Release Date: April 29, 2025 Host: Michael Barbaro Reporter: Deborah Kamin

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Introduction to the Landmark Settlement

In April 2024, a significant legal settlement was reached aimed at overhauling the U.S. real estate commission structure. This settlement was intended to democratize and reduce the costs associated with buying and selling homes by dismantling the longstanding 6% commission norm imposed by the National Association of Realtors (NAR). Deborah Kamin, a seasoned reporter for The Daily, delves into the aftermath of this settlement and explores why its anticipated transformative effects have been largely muted.

High Expectations and Initial Optimism

The settlement sparked immense optimism among economists and industry analysts, who heralded it as the most significant change in the real estate sector since the New Deal. The primary goal was to foster competition and provide consumers with more negotiating power over real estate commissions, potentially lowering the total cost of home transactions.

"The expectations were sky high. The words that were being used by economists and analysts in the industry, earth shattering, watershed, landmark..." (02:00)

Realtors' Powerful Influence and Resistance

The National Association of Realtors, boasting 1.5 million members and extensive lobbying power, were the primary opponents of the settlement. Historically, NAR had maintained a rigid commission structure, arguing that their services justified the 6% fee split between buyer and seller agents. Despite losing the lawsuit that challenged their commission practices, Realtors have employed various strategies to circumvent the new regulations.

"They have a lot of members. 1.5 million. They have more members than there are houses for sale in the US." (03:04)

The Great Real Estate Workaround

Deborah Kamin coins the phenomenon as "the great Real estate workaround," highlighting how Realtors have creatively sidestepped the settlement's restrictions. The settlement prohibited commission negotiations on Multiple Listing Services (MLS), the primary online portals where homes are listed. In response, agents have found alternative methods to communicate and negotiate commissions outside of these official channels.

"The settlement was designed to take away these conversations that agents were having about commissions... they just move these conversations elsewhere." (06:09)

Creative Evading Tactics

1. Symbolic Messaging: Agents include subtle hints in listing photos, such as placing three cookies on a kitchen table to imply a 3% commission.

   "Some of them are much more old fashioned. We're talking emails, phone calls, texts. Some of them are really tech savvy." (09:15)

2. Leveraging Social Media and Technology: Influential agents create landing pages or utilize platforms like TikTok to transparently display commission details, bypassing MLS restrictions.

   "She just said, okay, you can't go on the MLS I'm sure someone's going to have another way, but I'm going to build a landing page..." (10:03)

Case Study: Mike Chambers' Battle in Boulder, Colorado

One of the most illustrative examples of Realtors evading the settlement is the story of Mike Chambers, a homeowner in Boulder who attempted to sell his $2.75 million home without an agent.

Challenges Faced:

• Inflexible Commission Structures: Despite the settlement, Chambers found that agents were unwilling to negotiate below a 2.5% listing commission, effectively maintaining the traditional 6% rate.

  "I couldn’t find an agent who was willing to go below 2.5% to list my house." (18:05)

• Systemic Barriers: Colorado's stringent laws made it exceedingly difficult for homeowners to list properties on MLS without representation. Even major platforms like Zillow imposed additional hurdles, making FSBO (For Sale By Owner) listings less visible.

  "Zillow actually has a program that homes that are sold for sale by owner... are actually harder to find than homes that are listed by agents." (21:32)

• Realtor Boycott: As Chambers gained notoriety through his Instagram channel "Realtors Hate Me," local agents collaboratively boycotted his listing, steering potential buyers away from his property.

  "They told this other agent who wanted to bring buyers. Why would you take buyers to a house with a seller who's working against the system..." (22:48)

Outcome:

Despite receiving an offer, Chambers ultimately withdrew from the sale due to the relentless opposition from the Realtor community. Instead of retiring his plan, he decided to launch a startup aimed at reforming real estate commissions, highlighting the resilience and adaptability of realtors in preserving their traditional revenue models.

"Rather than moving his family to Costa Rica... he's now going to stay in Colorado and work on this startup company..." (23:25)

Industry and Regulatory Response

While the Justice Department has been investigating NAR for years, ongoing enforcement and clarification of the settlement's terms have been slow. The DOJ's limited resources and other priorities have hindered swift action against NAR's continued control over commission structures.

"The Justice Department has a lot of other things on their plate right now... It's anyone's guess how high of a priority this is." (25:28)

Prospects for Change: A Gradual Transformation

Deborah Kamin draws parallels between the current situation and the decline of Blockbuster in the face of streaming services. Change within the real estate sector is expected to be gradual, requiring time for new practices to take root and for consumers to become more informed and empowered.

"Blockbuster did not shut down all of its stores the minute things started streaming. It took time..." (29:09)

Advice for Buyers and Sellers

For those navigating the current real estate landscape, Kamin emphasizes the importance of transparency and negotiation. Even if agents seem unwilling to reduce their fees, consumers have the right to:

• Ask Detailed Questions: Understand what services justify the commission fees.
• Seek Alternative Agents: Find agents who are open to negotiating commissions.
• Consider FSBO Carefully: While challenging, selling independently can offer cost savings if done correctly.

"You can negotiate on commissions. And if the agent doesn't want to, you have the right to go find another agent." (27:54)

Conclusion: A Work in Progress

The settlement aimed to revolutionize the housing market by making commissions more transparent and negotiable. However, entrenched interests and creative evasion by Realtors have significantly tempered these reforms. While change is inevitable, it will unfold over time, requiring continued advocacy and consumer awareness to realize the intended benefits of lower housing costs and increased market competition.

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Notable Quotes:

• Deborah Kamin (02:35): "But we're talking about a drizzle, not a watershed."
• Mike Chambers (16:49): "I'm a marketer. That's my background. So I felt confident in my ability to market the home."
• Kevin Sears (07:57): "We're not going to sell this guy's house because he's not playing by the rules."
• Deborah Kamin (25:46): "There's a huge gap in understanding. And in the middle are agents on the ground just trying to make money and home sellers and buyers just trying to navigate the process."

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This episode of The Daily provides an in-depth look into the ongoing struggle between regulatory reforms in the housing market and the entrenched practices of the Realtor industry. As realtors continue to find innovative ways to maintain their commission structures, the battle for a more transparent and consumer-friendly housing market remains unresolved, highlighting the complexities of instituting systemic change in a deeply established industry.

Transcript

[Deborah Kamin]

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[Michael Barbaro]

New York Times, I'm Michael Barbaro. This is THE daily. Last year, a historic legal settlement created sweeping new reforms that were supposed to lower the price of buying and selling a home across the country. But those reforms would cost Realtors money. And so those Realtors, it turns out, have found ways to evade the new reforms. My colleague Deborah Kamin explains how they did. It's Tuesday, April 29th. Deborah? Michael, welcome back to the Daily.

[Deborah Kamin]

It's nice to be here again. Good to see you.

[Michael Barbaro]

It's really nice to see your face in the flesh. In the flesh. So a year ago, as many listeners I hope will remember, you came on THE Daily to describe this really bombshell legal settlement that was supposed to transform how homes are sold in the United States. And I want to start by having you remind us what that settlement was all about and why it was we felt wrongly, as it turns out, that this was going to be such a watershed moment.

[Deborah Kamin]

The expectations were sky high. The words that were being used by economists and analysts in the industry, earth shattering, watershed, landmark, the greatest change of the real estate industry since the New Deal, things that were really pinning hopes that this was going to shake up a stagnant housing market and offer real relief to consumers in the US who desperately need it. And a lot of that was pinned to the idea that rules were going to be followed to the letter. And they were not. So here we are a year later and things have shifted a tiny bit. But we're talking about a drizzle, not a watershed.

[Michael Barbaro]

Just take us back to the settlement.

[Deborah Kamin]

So to take you back to the settlement, we actually have to go back a little bit further to October of 2023, when the national association of Realtors, which is the trade organization that really oversees the real estate industry, they are the large, largest trade group in the United States. They are hugely powerful. They have a ton of money and a really massive amount of power and influence because of their lobbying arm.

[Michael Barbaro]

Right. You describe them as so powerful that they've trademarked the word real estate agent, the word Realtor?

[Deborah Kamin]

Yes. It is a trademark of nar, so you can only use it if you are a member of this group. And they have a lot of members. 1.5 million. They have more members than there are houses for sale in the US So we're talking a very big, very powerful group. They were sued by a group of home sellers in Missouri. The idea behind the lawsuit was that their rules had essentially fixed prices on real estate commissions, inflated them and made it so that real estate commissions were higher than they should have been. They did not expect to lose this lawsuit, but they did lose this lawsuit and a jury agreed that they were fixing prices on real estate commissions.

[Michael Barbaro]

Right. And I remember from our first conversation that that price fixing claim really revolves around the amount of money that you owe the agents that comes out of selling a house.

[Deborah Kamin]

Yeah. The dreaded 6%. It comes out of your pocket if you're selling. And anyone who's ever bought or sold a house knows that when you sit down with your agent, it's overwhelming, it's confusing, and it gets wonky. No one really asks, how are these commissions paid?

[Michael Barbaro]

And it's just kind of there.

[Deborah Kamin]

Right. And you also have enough things to worry about that you don't get into the weeds about how these commissions are paid. But for real estate agents, for realtors, this is how they make their living. This is very important. It's literally their bread and butter. And this settlement was meant to shake up the system of how those commissions are determined and how they're paid.

[Michael Barbaro]

Right. No longer were they simply tablets handed down from gone on the mountain. In the real estate industry, they were subject potentially to negotiation, conversation, and potentially they could go way, way down, maybe even go away.

[Deborah Kamin]

We are wandering the desert now. Absolutely. Most importantly, it was meant to say, this is the way it's been done for a long time. The way it's been done has actually been anti competitive. It's blocked competition. Now it's changed. Now home sellers can say, I want to pay X, I want to pay Y. It's up to you how much commission you want to pay.

[Michael Barbaro]

Right. And that brings us back to our superlatives, because if suddenly a 6% commission on a home sale might not be 6%, but might be 5 or 4 or 3 or whatever, then suddenly home prices might change, might go down.

[Deborah Kamin]

That is what economists predicted, because commissions are actually baked into home sale prices. When you sit down with a Realtor before you sell your home and there's all this paperwork and all this mumbo jumbo, one thing you generally do is you have a conversation. This is how much commission you're going to pay me as your agent. So as a result, we're going to set the price for the home here so that when that commission is paid out, you still take home as much as you want. And if commissions go down, if you're only paying 5%, a 1% reduction in home prices across the board in the US is a massive dent in the housing market that actually really should open things up for a housing market that is so tight and so restrictive for so many buyers.

[Michael Barbaro]

Right.

[Deborah Kamin]

So we were really optimistic that it was going to change things.

[Michael Barbaro]

So let's talk about the big and then moment in this story of why all this promised superlative change has not come to pass.

[Deborah Kamin]

I call it the great Real estate workaround.

[Michael Barbaro]

Hmm. Very intriguing.

[Deborah Kamin]

Thank you.

[Michael Barbaro]

Explain.

[Deborah Kamin]

The settlement was designed to take away these conversations that agents were having about commissions. These conversations were happening over these channels, these databases. They're called mlss, Multiple Listing Sites.

[Michael Barbaro]

Right. These are online portals used by real estate agents to basically list a house.

[Deborah Kamin]

Exactly. It's where home listings live on the Internet. And if you're an agent and you're working with a buyer and you're looking for houses, you go to the MLS to see what houses are for sale. But each listing has information on it, the address, the square feet, et cetera. It also used to have a commission amount.

[Michael Barbaro]

This is probably the place where we need to remind everyone that commissions tend to be split. Right. Between the agent for the buyer and the agent for the seller.

[Deborah Kamin]

Yes. Almost universally.

[Michael Barbaro]

Even though it comes out of the.

[Deborah Kamin]

Seller'S pocket, the seller pays the commission to their agent, and that agent for the sellers then splits that commission with the buyer's agent.

[Michael Barbaro]

Right.

[Deborah Kamin]

That's how it has been done for a long time.

[Michael Barbaro]

And MLS just kind of laid it all out.

[Deborah Kamin]

Yes. And the key focus of the settlement was that should be no more moving forward. Post settlement. The rules said that sellers pay their own agents, buyers pay their own agents. If you work with a real estate agent, it's up to you to pay them. That was what was supposed to happen, which should have brought a lot more competition and negotiation into the marketplace.

[Michael Barbaro]

What workaround could work around that?

[Deborah Kamin]

Well, the settlement was very specific in its language that these conversations about splitting commissions could not happen on these databases. So the real estate community was like, okay, okay, we'll just move these conversations elsewhere. It never said we can't have them at all. And I don't mean this is happening in secret.

[Kevin Sears]

Hello, my name is Kevin Sears, and I am the 2024 President of the national association of Realtors. Today, I'd like to touch on a.

[Deborah Kamin]

Couple of things just a few days after the settlement.

[Kevin Sears]

Now, in the settlement, there are a couple of key pieces. One is financial. The other is rules. Now, let's talk about the rules.

[Deborah Kamin]

The president of NAR made a video that went out to every realtor in the group.

[Kevin Sears]

Please hear me clearly. You will still be able to offer compensation to a buyer broker. It just cannot be conveyed on the mls.

[Deborah Kamin]

That said to move these conversations.

[Kevin Sears]

If there's one thing I know about members, they will figure out how to efficiently communicate the information to see if there will be any cooperating compensation.

[Deborah Kamin]

That video was backed up by NAR's head of legal, who has doubled down on the idea that in the settlement, the language says these conversations are banned only on the mls.

[Michael Barbaro]

Hmm.

[Kevin Sears]

So just know that we are doing everything we can to continue to advocate for your ability to help buyers, sellers, tenants, and landlords all across our great country.

[Michael Barbaro]

So where exactly do these conversations move to once the premier trade group of the realtor world says to them, go be creative and find a new place to have these conversations?

[Deborah Kamin]

Michael, it's gotten a little bit wild. I spent the past year following this very closely talking to agents, talking to industry insiders. Remember, the 6% was split 50 50. So usually the seller and the buyer's agent would each get 3%. I've heard stories of agents who in listing photos are putting three cookies on the kitchen table as a sign to a buyer's agent. If you bring a buyer, you'll get 3%, which means they'll get their 3% also.

[Michael Barbaro]

Oh, wow. That's quite nefariously creative.

[Deborah Kamin]

It's one way to put it. I've heard other stories of agents who've put movies on the TV screen in.

[Michael Barbaro]

The living room during a showing of the house.

[Deborah Kamin]

During a showing, or even in the listing photo, there's a movie playing, but it's a movie that has three in the title. Like the three amigos.

[Michael Barbaro]

Oh, my gosh. A real kind of open winking of defiance.

[Deborah Kamin]

Yeah, some of them are much more old fashioned. We're talking emails, phone calls, texts. Some of them are really tech savvy. There is one agent in Virginia, she's an influencer on TikTok. I'm just Liz and I sell real estate in Charlottesville and Richmond, Virginia. And this is the way we're going to do it. She just said, okay, you can't go on the MLS I'm sure someone's going to have another way, but I'm going to build a landing page and she's created a landing page that other agents can use. Easy peasy for every one of my listings. And on that landing page is going to be all the information that any buyer's agent would need to know. So I can easily just poof, text it to them. Here you go. It enters all the homes they have for sale into their separate non MLS site, compiles their data and includes the commission.

[Michael Barbaro]

So this is pretty open and creative and perhaps legal flouting of this ruling and settlement. How much, Deborah, do you think that this represents? Real estate agents thinking to themselves, look, this is how we get paid. Our work is important to the process. We are essential. And many people will tell you that they're, especially on the seller side, broker work their tush off, increase the value of their home. Maybe not everyone.

[Deborah Kamin]

There's data that says that people who use real estate agents tend to get a higher price.

[Michael Barbaro]

There it is.

[Deborah Kamin]

I mean, so there could be confounding variables to that data. Those people could have more money, could have higher priced homes. There's all sorts of things. But yes, there is a lot of data to back it up.

[Michael Barbaro]

So isn't this the equivalent of agents creatively fighting to keep the equivalent of a waiter's 15% tip? It's like it's what they need to live.

[Deborah Kamin]

Yes. And it's important to understand this is not happening organically. In many, many ways, real estate agents are just doing what they've been told by the national association of Realtors to survive in an industry that is cutthroat. Again, we're talking more agents than listings. There are not enough houses to go around. And agents do not work for companies. They're independent contractors. They pay their own taxes, they split their commissions with their brokerages. For the people on the ground, this really is a life or death moment for their career. So they feel we're being told we should have the conversations elsewhere.

[Michael Barbaro]

And so they are.

[Deborah Kamin]

Why would they not? Right. It's their job. But if you talk to the legal team that argued the settlement, they would say sharing is caring. Unless we're talking about real estate commissions and then sharing is collusion and the real losers are home sellers. Because the settlement was supposed to drive down prices.

[Michael Barbaro]

Right. So how effective have the great workarounds that you're describing here been in preventing the reforms and reductions in price that we thought this settlement was going to usher in?

[Deborah Kamin]

Initial data shows that these Workarounds have been very effective at preventing the reforms. There have been a handful of studies in the real estate industry looking at how commissions may or may not have moved. The data is problematic because most of them are being carried out by people in the real estate industry. So they have a vested interest in the data. That makes the data less than reliable for reporting processes. But one study by one real estate media company showed that in the months after the settlement, commissions dropped about half a percentage point across the board, which is a lot of money. It's not this watershed that we thought was going to happen, but it's something Two other studies, one was carried out by Redfin, which is also a brokerage.

[Michael Barbaro]

Right.

[Deborah Kamin]

And one was carried out by a real estate accounting technology company. So they have a vested interest in this data. State commissions haven't moved at all. So the American home seller is not getting any relief at a time when they desperately need it. So we can use that data, but we don't want to rely on it because of the conflict of interest. What is more telling are the conversations I've had reporting on this for the past year. I've talked to dozens and dozens of home sellers and buyers. Right.

[Michael Barbaro]

The ones interacting most directly with the commission.

[Deborah Kamin]

So this is anecdotal data, but there's a lot of it. And they are all telling me that not only are there workarounds, they're more aggressive than ever and they're more frustrating than ever. Some sellers are so frustrated that they're saying, I'm just gonna go it alone. I'm gonna sell my house on my own and cut realtors totally out of the equation.

[Michael Barbaro]

Find a workaround around the workaround.

[Deborah Kamin]

A workaround around the workaround, around the workaround. But you know, Michael, you used a biblical reference earlier about Mount Sinai. I'm use another one. We're really in a David versus Goliah sort of situation where you have these individual sellers who want to sell their very valuable asset and an entire industry of realtors who are very committed to maintaining the status quo, mobilizing together to fight them every step of the way and make it extremely difficult to work around the system.

[Michael Barbaro]

We'll be right back.

[Deborah Kamin]

This podcast is supported by Andor Season 2. Critics everywhere hailed the first season of Andor as the best Star wars series yet. The Wrap called it thrilling and exciting and the Verge said it's truly phenomenal storytelling. The Emmy nominated series stars Diego Luna as Cassian andor watch as he embarks on a path from rebel to Hero Andor Season 2 is now streaming only on Disney.

[Sydney Harper]

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[Michael Barbaro]

So, Deborah, tell us about some of the sellers who tried to go it alone because they're so frustrated with the world of Realtors, with the commissions and the status quo and about the resistance that, as you said just before the break, they encounter when they try to do that.

[Deborah Kamin]

Michael, let me tell you about one of them.

[Kevin Sears]

Day two of trying to sell my house without an agent in one of the most rigged real estate markets in the country.

[Deborah Kamin]

His name is Mike Chambers. He's a home seller in Boulder, Colorado.

[Kevin Sears]

They try to make this impossible, but I have a plan. Okay. So I actually.

[Deborah Kamin]

And I first became aware of him because a source sent me a video on Instagram that Mike had made.

[Kevin Sears]

All right, let's clear something up, because from the first video, I think a lot of people assume. I think realtors are useless, and the truth is I don't. But I do think that most drastically overvalue their services. And in Colorado specifically, they kind of operate like a cartel. So here's my take.

[Deborah Kamin]

He created a handle called Realtors Hate Me, and he was chronicling the process of selling his house himself without an agent. Are you okay if I record our call?

[Kevin Sears]

Yeah, that's fine.

[Deborah Kamin]

Okay. Fabulous. So. So I called him to find out what was going on, and he told me his story. Mike is a former professional athlete, an entrepreneur.

[Kevin Sears]

I have no background in this whatsoever. I've been thrown into this. Honestly, I didn't really think too much about the real estate industry until about four weeks ago when I decided that I wanted to list my house myself.

[Deborah Kamin]

And Mike has a really nice house.

[Kevin Sears]

You know, I've got a. I've got a great house. It's turnkey. It's in a desirable location and desirable city.

[Deborah Kamin]

It's worth probably about $2.75 million.

[Michael Barbaro]

A really, really nice house.

[Deborah Kamin]

Really nice house. Turnkey, renovated.

[Kevin Sears]

I spent the past couple months having some conversations with local agents regarding potentially listing my home.

[Deborah Kamin]

He decided to put it on the market. He interviewed a handful of real estate.

[Kevin Sears]

Agents, and in those conversations, I asked the questions that I would. Of any sort of service provider that I would be interviewing to get a sense of, like, how they were going to provide value.

[Deborah Kamin]

He knew about the settlement. He had read the reporting. He knew that things were supposed to be different now. There was supposed to be room for negotiation.

[Kevin Sears]

You know, I couldn't find an agent who was willing to go below 2.5% to list my house.

[Deborah Kamin]

Every single seller who came to his home said, I'm not willing to negotiate, and wanted him to pay at least 5% commission. It's going to be $140,000 on a $2.75 million house. That's over $100,000.

[Kevin Sears]

Oftentimes it, like, equates to about 10 to 30 hours worth of work.

[Deborah Kamin]

Exactly. For many people in this country, that's a salary for a year they could only dream of achieving. And he could not figure out what the agents were going to do that was worth $100,000, because, like you said.

[Michael Barbaro]

This house is ready to sell. It's pristine. So in his mind, it doesn't need the kind of attention, the kind of love, the kind of investment that a seller's agent can bring when a house is in rougher shape, when it needs work.

[Kevin Sears]

Yes, it was a lot of money. Everyone's like, well, you're being cheap. Like, it's such an expensive house. I'm like, it's my money. Like, I've worked hard to build this equity in this house, and I don't want to just give it away. I. I want to pay someone for their services, of course, but I don't want to just. Just light it on fire just because there's a system that's forcing me to. That seems kind of crazy.

[Deborah Kamin]

And a lot of real estate agents obviously would disagree with this. But from Mike's opinion, this is his asset. He did not want to put forth $100,000 or more of the sale price to an agent, but nobody was willing to negotiate.

[Kevin Sears]

So anyhow, it all just felt Weird. I just didn't like it. I was frustrated with it and really just had this epiphany. Like, I was, I'm a marketer. That's my background. So I felt confident in my ability to market the home.

[Deborah Kamin]

So he said to himself, and then, how hard can it be?

[Kevin Sears]

So I just decided to go for it.

[Deborah Kamin]

I'm going to do it myself. And he began not just selling his house on his own, but chronicling the whole thing online for viewers and building a following as he did it.

[Michael Barbaro]

Okay, and what happens once Mike decides to go it on his own? Based on all these frustrations with Realtors.

[Deborah Kamin]

In Boulder, he starts running into roadblocks. He learns very quickly that the industry has made it much harder than he thought to sell his house. First of all, he knows that if he wants a buyer to come, he needs to offer commission to the buyer. He was willing to.

[Michael Barbaro]

I'm just gonna slow this down to make sure I understand.

[Deborah Kamin]

Sure.

[Michael Barbaro]

He knows he's gonna have to offer some percentage commission to the buyer's agent. He himself is his own agent. So he's the seller's agent. That's taken care of.

[Deborah Kamin]

It's almost like he's in court representing himself.

[Michael Barbaro]

Okay.

[Deborah Kamin]

So he knows if I want buyers to come, I should probably be willing to pay the buyer's agent commission.

[Michael Barbaro]

So he's already winning in a sense, because the commission he's paying is probably gonna be, what, around half of what he would normally pay if he had to pay both the buyer and the seller's agent.

[Deborah Kamin]

Exactly. So he's willing to pay that commission, and he wants to get the house listed on the MLS so people can find it. Now, if you're not working with an agent, how do you list a house on the mls?

[Michael Barbaro]

I don't know.

[Deborah Kamin]

He Googles it. He figures this out. There's companies that do this for you. But he lives in Colorado, and he quickly learns that in Colorado, there are laws that say, if I'm gonna list the house on the mls, I have to also do a bunch of other stuff, and you have to pay me all this stuff. It's a designed by realtors to make it too hard to get your house listed on the mls.

[Kevin Sears]

That was the tipping point for me, where I was like, this is a mess. This whole system is a mess.

[Deborah Kamin]

Then he realizes that he wants to get his house listed on Zillow. Everybody uses Zillow in Redfin to search for houses.

[Kevin Sears]

In enlisting my house on Zillow, I learned that even Zillow has its own safeguards to push people to work with brokerages.

[Deborah Kamin]

And he learns that Zillow actually has a program that homes that are sold for sale by owner, not with agents, are actually harder to find than homes that are listed by agents.

[Michael Barbaro]

So the agents strike back again.

[Deborah Kamin]

So, basically, in real time for all these people following on Instagram, he's discovering all these layers to the real estate industry that he didn't know existed.

[Kevin Sears]

So here I am. I can't get on mls. Zillow's sort of stonewalling me.

[Deborah Kamin]

So he gets the home on the market. He stages it, he takes photos. It's ready to go. Buyer's agents in Boulder know about his house.

[Kevin Sears]

Obviously, like, these videos are starting to go viral, and there's starting to be a conversation locally about my story in particular, and I start to, like, hear some weird stuff. And.

[Deborah Kamin]

And one day, one of them gives him a call and says, something's happening that you need to know about. Agents representing buyers at my company are talking to each other in text and in person, saying, we're not going to sell this guy's house because he's not playing by the rules.

[Michael Barbaro]

So agents who might represent potential buyers who would love to have a $2.7 million turnkey house in Boulder are saying, we are not going to take our potential buyers to this house. We're going to boycott it.

[Deborah Kamin]

There's a word for this in real estate. It's called steering. You're either steering buyers towards a certain home or away from a certain home, and you're not allowed to do it, but it happens all the time.

[Michael Barbaro]

And what would be the explanation that these agents would have for steering people away from Mike's house?

[Deborah Kamin]

There's no hypothetical. They gave the explanation in text messages that I saw when I was reporting.

[Michael Barbaro]

Wow.

[Deborah Kamin]

They told this other agent who wanted to bring buyers. Why would you take buyers to a house with a seller who's working against the system, who's undermining the way things have been done? It was a boycott.

[Michael Barbaro]

So what ends up happening to Mike and to his house?

[Deborah Kamin]

So Mike does find a buyer. There's a couple in Florida who seize the house on Zillow. They make an offer. He actually offers to pay a commission to the agent who's representing them. But in the end, he actually pulled out of the sale because Mike decided after seeing so much of the inside workings of the real estate industry, that he wants to start a business to try to fix it. Wow. So rather than moving his family to Costa Rica, which was his dream, he's now going to stay in Colorado for the time being and work on this startup company that he's created to try to change real estate commissions.

[Michael Barbaro]

Fascinating.

[Deborah Kamin]

He told me about how it's not that he's trying to take down the real estate industry.

[Kevin Sears]

I do think there's a critical role for real estate agents in the world, and I think this has never been my issue.

[Deborah Kamin]

He believes that real estate agents are very important and sometimes are really useful.

[Kevin Sears]

Just allow me to act in my own best interest. And through this experience so far, it's felt like quite the opposite.

[Deborah Kamin]

His message, though, which has been echoed by many other people I've spoken to in my reporting, is that you should be able to determine how much you want to pay for that service. And the industry is on allowing those conversations to come to the surface. Sounds good. All right, great to meet you.

[Kevin Sears]

Bye bye.

[Michael Barbaro]

Right. Because everything you found and he found is that one way or another, agents are still operating to a real degree in the shadows as they try to ensure that the commission structure that is supposed to be negotiable is actually not all that negotiable.

[Deborah Kamin]

If you talk to economists and analysts in the industry, they will say the settlement was a massive breakthrough moment. If you talk to agents, many of them will say the settlement changed nothing. There is a huge gap in understanding. And in the middle are agents on the ground just trying to make money and home sellers and buyers just trying to navigate the process. There's no clear communication here about how it's supposed to work.

[Michael Barbaro]

So surely the government regulators know what you know. Maybe that's asking too much.

[Deborah Kamin]

Well, they read us. They do, Right?

[Michael Barbaro]

They know what you know based on your reporting. And they would seem to have a real interest in enforcing the original settlement in as broad a way as possible. Right. So is that happening? Is there an effort underway to clarify some of this confusion that you are still seeing out there?

[Deborah Kamin]

Yes and no. The Justice Department has been investigating the national association of Realtors for years. There's been a back and forth with them for a very long time. The settlement was brought by private home settlements. Right.

[Michael Barbaro]

It wasn't a government loss.

[Deborah Kamin]

It wasn't. But the DOJ was absolutely investigating nar, and they continue to investigate NAR commissions, and the conversations about commissions are a huge piece of that investigation. But the Justice Department has a lot of other things on their plate right now. The government is very busy and working with many fewer staff than they used to. So it's really anyone's guess how high of a priority this is. And if there's going to be further enforcement, is there an appetite for it? Yes, definitely.

[Michael Barbaro]

Understood. I think it makes sense to end here with a little bit of news that you can use, which isn't exactly the space we normally occupy, but. But I'm just going to assume that somewhere in the universe of daily listeners are folks who are thinking of buying or selling their home, or perhaps are in the process of buying or selling a home and could benefit from the journalistic wisdom that you have accumulated over the past year or so reporting on this. So what would you say to people who are trying to figure this out? Perhaps aren't willing to do what Mike did, which is actually take charge of the whole process themselves, but they just want to be able to navigate the current dynamic in the best way possible?

[Deborah Kamin]

If I've learned anything in the last year from reporting on this, it's that buying and selling a home is really scary and really overwhelming to the vast majority of people. Mike is an anomaly because he decided to just go with his own and kind of figure it out as he was going along. For most of us, it's really scary. I've sold a home. I remember sitting down with my agent. I had no idea what the stack of papers was in front of me. And we just agreed to whatever she said because we trusted her.

[Michael Barbaro]

You, a real estate reporter, didn't ask about the commission?

[Deborah Kamin]

I did not ask about the commission. I'm willing to say that to you, Michael Faro, to your face. I did not ask about the commission. I think we paid 6%. I honestly don't remember if it happened to me. It can definitely happen. To anyone who's listening to this, it is not a problem to pay 6% as long as you know what you've.

[Michael Barbaro]

Agreed to, which probably means asking.

[Deborah Kamin]

My number one piece of advice is to understand, even if you're told you cannot negotiate any commissions, you can negotiate on commissions. And if the agent doesn't want to, you have the right to go find another agent. You also absolutely have the right to know what you are paying for and to ask the questions. Okay, you're going to charge me this much money. What are you doing for that money? Just like you would with any other transaction.

[Michael Barbaro]

It's my understanding, based on everything I have read, that this legal settlement has only officially been in place, I think, for a little bit less than a year, right?

[Deborah Kamin]

Since August of last year, Correct?

[Michael Barbaro]

Exactly. So I wonder if there's a case to be made that as successful as all these workarounds have been, that it's still very early days and that over time the system could change to better benefit the consumer as they become more aware of guidance like what you're talking about here and of the new realities and rules that are now in place, or if you think that the more time goes by, the more power that realtors and the realty industry will accumulate.

[Deborah Kamin]

Michael I asked this question to the lawyer who brought the case that resulted in the settlement and won it. His name is Michael Ketchmark. And what he said to me was pretty interesting. He said, you know, Blockbuster Video, when movies started streaming.

[Michael Barbaro]

Okay, now you're really taking us back.

[Deborah Kamin]

Yes, I am. Back to the 90s. But Blockbuster did not shut down all of its stores the minute things started streaming. It took time, right?

[Michael Barbaro]

VHS didn't just go the way of the dodo overnight. It probably took what, 10, 15, 20 years.

[Deborah Kamin]

Yeah, it was a great transformation, just like he believes this will be a great transformation, too. But these things do not happen overnight. We're talking about an industry that has been ruled by a group NAR for over 100 years, and only very recently have people started challenging the way things are done. So the people that I've spoken to in my reporting believe, yes, it is going to change, but it's going to take real time before those changes are clear and obvious and buyers and sellers feel the effects.

[Michael Barbaro]

Well, Deborah. Well, Michael, thank you very much.

[Deborah Kamin]

My pleasure, as always. FOREIGN.

[Michael Barbaro]

We'Ll be right back.

[Deborah Kamin]

Hey, I'm Tracy Mumford. You can join me every weekday morning for the headlines from the New York Times.

[Michael Barbaro]

Now we're about to see a spectacle that we've never seen before.

[Deborah Kamin]

It's a show that catches you up on the biggest news stories of the day. I'm here in Red Square. We'll put you on the ground where news is unfolding.

[Michael Barbaro]

I just got back from a trip out to the front line and every.

[Deborah Kamin]

Soldier and bring you the analysis and expertise you can only get from the Times newsroom.

[Michael Barbaro]

I just can't emphasize enough how extraordinary this moment is.

[Deborah Kamin]

Look for the headlines wherever you get your podcasts.

[Michael Barbaro]

Here's what else you need to know. Today, Canadians have chosen Mark Carney as their next prime minister after a campaign in which he vowed to fight back against President Trump's tariffs and his threats of annexation. It was a major comeback for Carney and his Liberal Party, which just a few months ago seemed destined for a historic defeat to the Conservative Party and its candidate. But as Trump's attacks on Canada have intensified, Canadians were increasingly drawn to Carney's promise to stand up to the American leader. And on Monday, Spain and Portugal were hit by a major power outage that disabled traffic lights, trains, subways and airline flights. Officials have not said what caused the outage, which affected tens of of millions of people, but they said it did not appear to be an act of deliberate sabotage like a cyber attack. Today's episode was produced by Mooj Zaidi, Rochelle Banja, Olivia Natt and Diana Wynn. It was edited by Liz O. Balin, contains original Music by Pat McCusker, Diane Wong and Dan Powell and was engineered by Alyssa Moxley. Our theme music is by Jim Runberg and Ben Landsfork of Wonderly. Special thanks to Nick Pittman. That's it for Daily. I'm Michael Balbaro. See you tomorrow. Planning for retirement and all the things that go with it can be stressful. That's why Fisher Investments partners with you to understand your goals and needs so that they can build a tailored plan that helps you achieve a comfortable retirement. Whether you need help with financial planning, estate planning or Social Security, Fisher has specialists to help Fisher Investments. Now that's clearly different. Money management learn [e-mail] Investing in securities.

[Deborah Kamin]

Involves the risk of loss.