The real estate industry has recently faced a groundbreaking legal development, with a $730 million settlement set to compensate home sellers who may have overpaid commission fees. If you sold a home between October 31, 2017, and July 23, 2024, and paid a real estate broker’s commission, you may be entitled to a portion of this payout. This lawsuit, filed as Gibson et al. v. National Association of Realtors et al., alleges that several major real estate firms conspired to maintain artificially high commission rates, violating antitrust laws and limiting fair competition.
The lawsuit claims that real estate brokerages engaged in coordinated efforts to enforce standard commission fees, preventing home sellers from negotiating lower rates. As a result, home sellers were forced to accept non-negotiable commissions ranging between 5% and 6%, leading to increased costs that may not have been necessary under a competitive market. To resolve the legal dispute, prominent firms such as Compass, Redfin, Douglas Elliman, and others have agreed to contribute over $110 million as part of the broader settlement fund.
This article provides a comprehensive guide on the lawsuit, who qualifies for the settlement, how much compensation claimants can expect, and the step-by-step process of filing a claim. If you are a home seller who paid commission fees within the last seven years, now is the time to act and determine your eligibility.
The Lawsuit That Reshaped Real Estate Commissions
At the core of this lawsuit is the accusation that real estate firms conspired to sustain high commission fees, restricting competitive pricing and burdening home sellers with excessive costs. Plaintiffs in the case argue that the real estate industry’s standard commission structure was maintained through unlawful coordination rather than market-driven competition. Key claims in the lawsuit include:
- Real estate brokerages colluded to set fixed commission rates.
- Home sellers were deprived of the ability to negotiate lower fees.
- The standard commission of 5%-6% was artificially upheld rather than determined by market forces.
As a result, home sellers who used these brokerages between 2017 and 2024 may have overpaid on commissions and are now eligible for compensation through this class action settlement.
Defendants in the Settlement
A coalition of real estate firms has agreed to pay settlements to resolve the allegations, though they have not admitted to any wrongdoing. These firms include:
- Compass Inc. – $57.5 million
- Real Brokerage – $9.25 million
- Realty ONE Group – $5 million
- @Properties (At World Properties) – $6.5 million
- Douglas Elliman – $7.75 million (+$10 million contingent)
- Redfin – $9.25 million
- Engel & Völkers – $6.9 million
- Home Smart – $4.7 million
- United Real Estate – $3.75 million
While these settlements do not imply guilt, they provide an opportunity for affected home sellers to recover some of their financial losses.
Who Qualifies for a Settlement Payment?
To be eligible for a payout from this settlement, claimants must meet the following criteria:
- Sold a home between October 31, 2017, and July 23, 2024.
- Listed the property on a Multiple Listing Service (MLS) in the U.S.
- Paid a commission to a real estate brokerage as part of the sale.
If you meet these conditions, you may be entitled to compensation from the settlement fund.
What If You Sold Multiple Homes?
If you sold more than one property during the eligibility period and paid commission fees on each sale, you may submit multiple claims to increase your compensation.
Required Documents for Filing a Claim
To verify eligibility and process claims, applicants must provide essential documents, including:
- Closing statements that confirm the home sale date.
- Proof of the commission fee paid to the real estate broker.
Without these documents, claims may be denied or require additional verification.
How Much Compensation Can Home Sellers Expect?
The exact payout will vary based on several factors, such as:
- The number of claims submitted by eligible sellers.
- The total amount of commission fees paid in each case.
- The proportional distribution of funds from the settlement pool.
While specific refund amounts have not been set, estimates suggest that sellers may receive 10%-20% of their commission fees back. For example, if a seller paid a 5% commission on a $400,000 home sale ($20,000 in commission fees), they could expect a refund of $2,000-$4,000.
Step-by-Step Guide to Filing a Claim
To claim your share of the settlement, follow these steps:
- Confirm Eligibility
- Visit the official settlement website at RealEstateCommissionLitigation.com.
- Use the available resources to check if your home sale qualifies.
- Gather Required Documents
- Locate closing statements and commission payment records.
- Ensure all documents clearly show the sale date and fees paid.
- Submit the Claim Form
- Deadline: May 9, 2025.
- Claims must be filed online or via mail.
- Await Review and Payment
- The final approval hearing takes place on October 31, 2024.
- Payments will be processed after claims are reviewed and approved.
Important Deadlines
Failing to meet these deadlines may result in losing the opportunity to claim a share of the settlement.
What Happens Next?
Once claims are submitted and reviewed, the Settlement Administrator will determine payout eligibility. If the settlement is approved in October 2024, payments will be disbursed throughout 2025. Home sellers who have already submitted claims related to this litigation do not need to reapply; their claims will still be considered.
For official updates and further details, visit RealEstateCommissionLitigation.com.