HomeServices of America, a real estate firm owned by Warren Buffett, has agreed to pay $250 million to settle a nationwide antitrust lawsuit. This settlement could potentially transform the way real estate agents are compensated.
The lawsuit alleged that the National Association of Realtors (NAR) and four brokerages, including HomeServices, had artificially inflated real estate commissions. A jury in Kansas City, Missouri, sided with the home sellers and awarded damages of $1.78 billion.
HomeServices' settlement follows the NAR's $418 million settlement last month. With this latest settlement, the NAR and the brokerages will pay over $943 million to resolve antitrust claims.
Analysts suggest that the agreed-upon changes could reduce commissions by at least 25%. This could have a significant impact on real estate agents' earnings and home sellers' costs.
The settlement also underscores the legal challenges large corporations face in their business operations. In this case, HomeServices was accused of colluding with other brokerages to fix prices. This type of behavior is illegal under antitrust laws.
The settlement is still subject to court approval. If it is approved, it will be a major victory for home sellers who have been overpaying for real estate commissions for years.