Real Estate Commission Changes in Arizona
Learn how written buyer agreements, negotiable agent compensation and changes to MLS compensation displays affect buyers and sellers in Surprise, Arizona.
Real Estate Compensation Is Negotiable
Real estate commissions are not set by law. The services provided, the amount or method of compensation and the party responsible for payment are negotiable.
This was true before the National Association of REALTORS® settlement practice changes and remains true today. What changed is how certain compensation information is communicated and documented.
The nationwide practice changes took effect on August 17, 2024. Their main goals included clearer written agreements and greater transparency about agent services and compensation.
What Changed in August 2024?
| Practice | What Changed | What It Means for Consumers |
|---|---|---|
| Written buyer agreements | MLS participants working with a buyer generally must enter into a written agreement before touring a home. | Buyers can review the agent’s services, responsibilities, agreement duration and compensation before touring. |
| MLS compensation displays | Offers of compensation to buyer brokers are no longer displayed through the MLS. | Compensation may still be communicated and negotiated outside the MLS. |
| Clear compensation terms | Buyer agreements must clearly identify the compensation amount, rate or objectively ascertainable method. | Compensation cannot simply be stated as whatever amount a seller or listing broker may offer. |
| Compensation limits | A buyer broker cannot receive more compensation than the buyer agreed to in the written agreement. | Buyers know the maximum compensation their representative may receive under their agreement. |
What Did Not Change?
Commissions Were Not Fixed
There was no universally required real estate commission before the practice changes, and there is no required commission now. Compensation has always been negotiable.
Sellers Were Not Universally Required to Pay
Sellers were not legally required to pay a buyer broker before the settlement. A seller can still decide whether offering compensation is appropriate as part of the property’s overall marketing strategy.
Buyer Representation Is Still Available
Buyers can continue to hire an agent to help evaluate properties, prepare offers, manage inspections, negotiate and guide the transaction.
Seller Compensation Is Still Possible
A seller may still agree to compensate a buyer’s broker, subject to the transaction documents, applicable rules and the terms of the buyer’s representation agreement.
Written Buyer Agreements in Arizona
A buyer working with an MLS participant generally signs a written buyer agreement before touring a home in person or through a live virtual tour.
Arizona REALTORS® provides different buyer-agreement forms, including agreements that may cover ongoing representation and shorter agreements focused on showing particular properties.
The appropriate form and terms depend on the relationship, services and brokerage.
The Agreement Should Explain
- The services the agent will provide
- The buyer’s and broker’s responsibilities
- The agreement’s duration and scope
- Whether representation is exclusive
- The amount or method of compensation
- How the agreement can be modified or ended
How Can a Buyer’s Agent Be Paid?
The buyer and broker should discuss compensation before touring homes. The written agreement should clearly state the agreed amount or method of calculation.
Depending on the transaction and negotiated agreements, buyer-broker compensation may come from one or a combination of sources.
Buyer Payment
The buyer may agree to pay some or all of the broker’s compensation, subject to the written agreement, financing requirements and the buyer’s available funds.
Seller Payment
A buyer may ask the seller to pay an agreed amount toward buyer-broker compensation as part of the purchase offer or subsequent negotiations.
Listing-Broker Offer
A listing broker may offer compensation to a buyer broker outside the MLS, subject to authorization, applicable rules and the listing agreement.
Combination of Sources
Compensation may sometimes come from more than one permitted source, but the buyer broker cannot receive more than the amount authorized in the buyer’s written agreement.
What Arizona Buyers Should Do
Discuss Representation Before Touring
Ask what services the agent provides, what the relationship means and which agreement will be used.
Review the Compensation Terms
Understand the amount or method of compensation, when it is earned and what the buyer could owe if another source does not pay it.
Understand the Scope and Duration
Confirm which properties, geographic areas and time periods the agreement covers and whether it is exclusive.
Plan Compensation With the Offer
If seller payment is requested, the amount and structure should be addressed in the offer and evaluated alongside price, concessions and other terms.
What Arizona Sellers Should Consider
Sellers should evaluate buyer-broker compensation as one part of their complete pricing and marketing strategy.
The decision is not simply whether to pay or not pay. Sellers should understand the available options, potential buyer requests, financing considerations and how each offer affects their estimated net proceeds.
Review the Listing Agreement
Understand the listing broker’s services and compensation, along with any authorization related to buyer-broker compensation.
Discuss Marketing Options
Ask how compensation decisions may be communicated outside the MLS and how buyer requests will be handled.
Compare Net Proceeds
Evaluate the purchase price, concessions, requested compensation, repairs, closing costs and other terms together.
Consider Each Offer Individually
The strongest offer is not always the offer with the highest price. Financing, contingencies, timing and total seller proceeds matter.
What VA Buyers Should Know
VA loan rules previously restricted veterans from directly paying certain buyer-broker charges. In response to the industry practice changes, the Department of Veterans Affairs issued a temporary local variance allowing eligible VA buyers to pay certain buyer-broker charges under specified conditions.
The variance remains subject to VA requirements and can be changed or rescinded. VA buyers should work with a lender and real estate professional who understand current VA guidance.
Compensation Remains Negotiable
A VA buyer may discuss buyer-broker compensation, seller payment and other permitted options before touring and before preparing an offer.
Confirm Current Loan Requirements
The buyer should confirm with the VA lender how compensation, seller concessions and closing costs will be treated in the specific transaction.
Learn about Todd’s veteran and military relocation experience
Official resource: VA Home Loan Circulars .
Before Signing a Real Estate Agreement
Buyer Questions
- What services are included?
- How long does the agreement last?
- Is the agreement exclusive?
- How is compensation calculated?
- Could I owe money directly at closing?
- What happens if a seller offers compensation?
- How can the agreement be modified or ended?
Seller Questions
- What services are included in the listing agreement?
- How is the listing broker compensated?
- What buyer-broker compensation options are available?
- How will buyer requests be evaluated?
- How will each offer affect my net proceeds?
- How will compensation information be communicated?
- Can the strategy be adjusted during the listing?
Learn More About Representation and Compensation
Real Estate Commission FAQs
Are real estate commissions fixed by law?
No. Real estate compensation is negotiable and is not set by law. Consumers should discuss services and compensation with their real estate professional before signing an agreement.
When did the real estate practice changes begin?
The nationwide NAR settlement practice changes took effect on August 17, 2024. They were already in effect throughout 2025.
Must a buyer sign an agreement before touring a home?
An MLS participant working with a buyer generally must have a written agreement before conducting an in-person or live virtual home tour. Merely discussing an agent’s services or visiting a seller-hosted open house does not automatically create the same requirement.
Can a seller still pay a buyer’s agent?
Yes. A seller may agree to compensate a buyer’s broker, but the amount and structure are negotiable and should be documented through the appropriate transaction agreements.
Is buyer-agent compensation shown in the MLS?
Offers of compensation to buyer brokers are no longer displayed in the MLS. Compensation can still be communicated and negotiated outside the MLS.
Can a buyer ask the seller to pay buyer-broker compensation?
Yes. A buyer may include a request in the purchase offer. The seller can accept, reject or negotiate the request along with the offer’s other terms.
Can a VA buyer pay a buyer’s agent?
Current VA guidance provides a variance allowing eligible VA buyers to pay certain buyer-broker charges under specified conditions. The buyer should confirm the current requirements with an experienced VA lender.
Understand Your Options Before You Sign
Todd Pooler explains representation, services and compensation before moving forward so buyers and sellers can make informed decisions.
Todd has served Arizona real estate clients since 2013, has lived in Surprise since 2006 and is a retired U.S. Army Senior NCO and Military Relocation Professional.
This page provides general educational information and is not legal, lending or tax advice. Requirements, forms, MLS policies, brokerage practices and VA guidance can change. Review the actual agreements provided in your transaction and consult qualified professionals regarding your specific circumstances.
