Do Buyers Pay Realtor Fees? What Changed After the NAR Settlement

Here is the question every first-time buyer eventually asks, usually after they have already started looking at homes: do I have to pay my agent?

Until recently, the standard answer was "no" — the seller typically paid both agents' commissions from the sale proceeds, and buyers never saw that line item. That changed in August 2024, when a landmark settlement with the National Association of Realtors (NAR) rewrote the rules around how buyer agents are compensated.

If you are buying a home in 2025 or 2026, understanding this shift is not optional. It affects your contract, your costs, and how much leverage you actually have.

How Buyer Agent Commissions Worked Before

For decades, the standard model worked like this: the seller listed their home and agreed to pay a total commission — typically 5% to 6% of the sale price — to be split between their agent and the buyer's agent. That split was advertised on the Multiple Listing Service (MLS), so buyer agents could see which listings offered them the most commission.

From the buyer's perspective, this felt free. You used an agent, they got paid by the seller, and you never wrote a check for representation.

The problem, which the lawsuits underlying the NAR settlement argued, was that this system discouraged agents from showing listings with lower buyer-side commissions, and buyers rarely knew how their agent was being paid or whether that payment created a conflict of interest.

What Changed After the NAR Settlement

Effective August 2024, the NAR settlement introduced two major practice changes:

1. Written buyer representation agreements are now required before touring homes.

Before an agent can show you a property, you must sign a written agreement that specifies what services they will provide and how they will be compensated. This agreement must include a specific dollar amount or percentage — not a vague "as offered by the seller."

2. Offers of buyer agent compensation can no longer be displayed on the MLS.

Sellers can still choose to offer compensation to a buyer's agent as part of the deal. They just cannot advertise it through the MLS. This means the conversation about who pays your agent is now something you and your agent negotiate explicitly — either before the search or as part of your offer.

So Who Pays the Buyer's Agent Now?

In most transactions, the seller still pays the buyer's agent — but it is now negotiated rather than assumed. Here is how it plays out in practice:

Scenario 1: Seller agrees to cover buyer agent compensation. You make an offer and include a request for the seller to contribute toward your agent's fee, either as a seller concession or a direct commission agreement. Many sellers agree to this because it broadens their buyer pool. The commission comes out of the seller's proceeds at closing.

Scenario 2: You pay your agent directly. If the seller will not cover the buyer's agent fee and you want representation, you pay your agent's commission out of pocket at closing. This amount was previously invisible; now it is a line item.

Scenario 3: You negotiate a reduced or flat-fee arrangement. Some agents offer limited services for a flat fee or reduced rate. You get less hand-holding but pay less. This can make sense for experienced or well-organized buyers.

The key point: you need to have this conversation before you start touring homes, because once you sign a buyer representation agreement, you may be committed to compensating your agent even if the seller does not.

Questions to Ask Your Agent Before Signing Anything

The NAR settlement means you now have both the right and the responsibility to ask direct questions. Here is what to ask:

About compensation:

• What is your commission rate, and is it negotiable?
• If the seller does not offer buyer agent compensation, how does that work in my contract?
• Will you show me homes that do not offer a buyer-side commission?
• Are there any additional fees — transaction fees, admin fees, or platform fees — beyond your commission?

About representation:

• How many buyers are you currently working with?
• How many first-time buyers have you represented in the past year?
• What happens if I want to end our agreement? What is the exit clause?
• Will you be personally handling my search, or will it be a team member?

About the agreement itself:

• How long does this agreement last? (Be cautious of long lock-in periods — 30 to 60 days is reasonable; 12 months is not.)
• What specific services are included?
• Is the compensation amount a cap or a minimum?

Red flags to watch for: agents who resist putting the compensation amount in writing, agreements with no clear exit clause, or language that commits you to paying even if the agent does not perform.

What About the UK, Canada, and Australia?

The NAR settlement is a US-specific change, but buyer agent compensation works differently in other English-speaking markets too.

UK: Estate agents in the UK traditionally represent sellers, not buyers. As a buyer, you do not typically pay an agent's fee — the seller pays the estate agent. However, some buyers hire independent buyer's agents or property finders, particularly in competitive markets like London. These buyer's agents charge either a flat fee or a percentage of the purchase price, paid by the buyer.

Canada: Similar to the old US model, sellers typically offer a commission split. However, the landscape is shifting, and written buyer representation agreements are increasingly standard in provinces like Ontario and BC. If you sign a buyer representation agreement, understand what it commits you to if the seller is not paying the buyer's commission.

Australia: Buyers do not typically pay agent fees — agents are engaged and paid by sellers. However, you can engage a buyer's agent (also called a buyer's advocate) who charges a fee — usually 1% to 3% of the purchase price — to search and negotiate on your behalf. This is common in auction markets where competition is intense.

NZ: Similar to Australia — agents represent sellers. Buyers do not generally pay agent commissions, but buyer's agents do exist and charge for their services.

How to Use This Information as a First-Time Buyer

The practical takeaway is this: representation is not free anymore — at least not automatically. Before you tour your first home:

1. Understand that you may need to pay your agent if the seller does not
2. Ask every agent you interview what their fee is and whether it is negotiable
3. Read the buyer representation agreement before signing — pay attention to the compensation clause and exit provisions
4. Consider whether you need full-service representation or whether a limited-service arrangement would work for your situation

Being informed about this going in means you are not blindsided at closing and you can structure your offer intelligently.

The Right Questions Make the Difference

The Complete First-Time Homebuyer Checklist includes a full agent interview script — updated for the post-NAR settlement landscape — with specific questions covering compensation, representation agreements, and red flags to watch for. Understanding what you are signing before you sign it is the first step to protecting yourself in a transaction where the stakes are high and the fine print matters.