ABSTRACT: The $418 million NAR commission ruling last year has emboldened a fresh wave of legal and structural disruption. For realtors, the message is clear: reinforce relationships, build autonomy, and prepare to adapt on the fly.
Douglas R. Miller—a name that reverberates through brokerage corridors—is once again drawing his legal longbow. This time, his aim extends beyond the National Association of Realtors (NAR) to encompass the framework that underpins daily operations in many real estate brokerages: desk fees, joint ventures, referral incentives, and networks. The intricate architecture of the modern real estate industry is once again under scrutiny, with litigation poised to exploit any perceived vulnerabilities.
For many, this scenario evokes a sense of déjà vu. Following last year’s $418 million NAR settlement over customary commission structures, one might have assumed the industry’s legal tribulations had reached a denouement. Yet rather than quelling the storm, the settlement appears to have invigorated those seeking further “reform.”
Deciphering Miller’s Targeted Strategy
Miller’s approach is methodical, focusing on five critical facets of brokerage operations:
- In-House Service Recommendations: Encouraging agents to direct clients toward affiliated lenders, title companies, or inspectors.
- Commission Incentives for Referrals: Offering favorable commission splits to agents who channel business to in-house services.
- Desk Fee Adjustments: Reducing desk fees for agents who utilize internal service providers.
- Managerial Bonuses: Rewarding managers based on the rate at which ancillary services are captured.
- Joint Ventures with Realtors: Collaborations between brokers and third-party vendors.
While these practices may enhance operational efficiency, they also raise legal questions regarding potential conflicts of interest and anti-competitive behavior.
The Aftermath of the Previous Settlement
As we know from the last round, though it was unnerving for a period of time, most markets have returned to some form of business as usual. Plaintiffs’ attorneys, meanwhile, were awarded one-third of the $700 million total—roughly $233 million—plus an additional $16.5 million in expenses. Compare that to the paltry $900 per plaintiff. Not nothing, but it seems more about lining pockets than protecting sellers.
Though the settlement did little to affect day-to-day operations in most regions once it passed, it did alter external perceptions, emboldening litigators, legislators, and tech-forward enterprises to challenge the traditional real estate paradigm.
Strategic Movements Among Industry Leaders
Should we expect more of the same loud, blustery action with little output—or is this time different?
Amid this litigious backdrop, notable industry figures are making strategic decisions that signal potential shifts:
- Gary Keller and Keller Williams: Gary Keller, co-founder of Keller Williams, has reportedly sold a portion of the business to Stone Point Capital, which also owns CoreLogic and other real estate tech platforms. This move allows Keller and other owners to monetize their stake. While the company reports this as a strategic modernization move, the timing has raised eyebrows.
- Warren Buffett and Berkshire Hathaway: More notably, Warren Buffett—the investor everyone watches—has also been selling off interest in Berkshire Hathaway. While the specifics regarding real estate asset sales remain unclear, Buffett has been steadily moving to cash, amassing over $330 billion. When Buffett goes liquid, it’s rarely random. It’s usually prescient.
These shifts may represent innovation, as the official lines go. But with Rocket buying Redfin and other tectonic movements underfoot, they at least suggest a reevaluation of brokerage models in anticipation of broader industry disruption.
What Can Realtors Do Proactively?
In light of these challenges and transformations, we can’t be sure what the future holds for real estate—or mortgage, for that matter. What we do know is that big real estate tech companies, hungry for a piece of the action, periodically make a play to change the market. Remember Redfin’s 1% sellers’ program? It failed. Why? Because it undervalued the power of relationships and the art of the deal—two things you can’t automate.
When it comes to guidance, handholding, and deal-making, a good realtor is irreplaceable.
As the real estate industry faces another disruption, here are a few actionable ways to future-proof your role:
- Cultivate an Independent Brand: Develop or reinforce a personal brand that transcends brokerage affiliations, emphasizing your unique value and expertise.
- Elevate Your Consultative Role: Offer services, network and resources beyond the sale—staging, community intel, negotiation coaching. If you haven’t read the 7Ls Book, it’s a great idea generator!
- Ensure Transparency and Compliance: Keep airtight records. Disclose everything. Make integrity your trademark.
- Grow Your Entrepreneurial Mindset: Own your income stream through diversity. Consider launching complementary services that align with your brand. Get a coach if you don’t already have one.
- Monitor Industry Trends: Watch what the big players are doing. Not just the public announcements, but the footnotes. There is often more to the story and foreshadowing than meet that eye.
Embracing the Evolving Landscape
In a climate where adaptability is the new currency, staying ahead means not only rethinking how you serve clients but also how you structure your business behind the scenes. From optimizing referral workflows to creating financial models that actually reflect your value, there’s strength in having systems that support your instincts. If these questions are already on your mind, we’re here to help by showing up as the most trusted advisor in the room. To learn more about our proprietary loan process that incorporates technology with a human touch that creates a referrable experience and five-star reviews, give us ring or book on my calendar. I’d love to her your perspective and see how we can strengthen our network and relationships.
– At Ritter Mortgage, we are here to help you navigate all your homeownership needs and concerns. If we can answer questions or be of service, please don’t hesitate to reach out: 410-795-8900.
