There is a good reason why so many Americans — 1.6mn according to one estimate — work as real estate brokers or agents. The barriers to entry are low. No college degrees are required. The standard commission, 5 to 6 per cent of the purchase price, is split between the seller’s agent and the buyer’s agent. It is one of the world’s highest.
But a long overdue shakeout is looming.
In a seismic settlement last month, the National Association of Realtors (NAR), the all-powerful industry trade organisation, agreed to abandon a long-standing rule that requires home sellers to compensate the buyer’s agent. This has been required to list a property on a database known as the multiple listing service (MLS). The latter aggregates properties for sale regionally and is controlled by the NAR.