Is it possible that Florida real estate agents and brokers may not in compliance with the NAR settlement if Florida follows Alabama and Colorado?

Yes!  
Let us start with what happened with the National Association of Realtors (“NAR”).  We know that the NAR settled after a massive verdict worth over $5 billion in the Burnett case.  The settlement requires that the agents/brokers sign a “Buyer-Broker Agreement” (“BBA”) before showing a home to a buyer. The BBA requires the buyer to pay the agent/broker if seller or seller’s agent/broker does not pay the buyer’s agent/broker.

The Alabama Association of Realtors believes that this settlement has antitrust issues.  In addition, the Department of Justice released a “statement of interest” in the Burnett case stating that it limits competition.  The DOJ states:

“The proposed settlement includes a provision requiring buyers and their brokers enter ‘written agreement before the buyer tours any home.’ This provision itself raises independent concerns under the antitrust laws…thus, the concerns remain that the broker agreement rule may limit how brokers compete…”

See DOJ_SOI_Sitzer_Nov24-2024.pdf.

Essentially, the concern is that the NAR settlement forces buyers to bind themselves into a contract with an agent before seeing multiple homes and reaching a comfort level with the agent before signing the agreement.

To address the issue, the Alabama legislature, after aggressive lobbying by the Alabama Association of Realtors, passed a law, HB 230.  It states in part: 

“Pursuant to the National Association of Realtors (NAR) settlement agreement approved by the U.S. District Court for the Western District of Missouri, NAR created a new rule requiring brokers working with prospective buyers to enter into a written agreement with the prospective buyer prior to the prospective buyer touring a home. This requirement conflicts with existing law. In response to recent changes in industry practices, this bill would provide that a consumer must receive a disclosure form from the licensee prior to a real estate licensee showing him or her a property; and the disclosure of the specific brokerage services the licensee’s company provides must be in writing and include general information related to compensation of the licensee. This bill would provide that after the disclosure, a consumer retains the option to enter into a brokerage agreement with the brokerage company; however, the consumer is not required to enter into a written brokerage agreement as a prerequisite to the licensee showing him or her a property. This bill would further provide that a licensee and consumer are only required to execute a written brokerage agreement if the licensee will either list the property for sale or submit an offer to a seller on behalf of the consumer; and any brokerage agreement entered into must provide terms of compensation to the licensee and company.”

Emphasis added.  See HB230-int.pdf. 

The State of Colorado seems to agree with Alabama.  Marcia Waters, Division Director, Real Estate Division, Colorado Department of Regulatory Agencies has stated in writing that Colorado law does not require a prospective buyer to sign an agreement (i.e. BBA) with an agent/broker in order to view a property, citing C.R.S. § 12-10-301.

See Colorado_Letter.png (1025×1264).

Both Colorado and Alabama laws contradict the NAR settlement.  This potentially creates a scenario where a real estate agent/broker in Alabama or Colorado would be in violation of the NAR settlement (if the agent/broker did not require a BBA before showing a property) or the state law (if the agent/broker did require a BBA before showing a property).

Fortunately, the NAR settlement makes it clear that state law preempts it.  Therefore, the agents/brokers in Colorado and Alabama are not in violation of the NAR settlement and policies of NAR when they follow their state law.

It is clear that the practice of real estate is no longer uniform nationwide, as much as NAR would like it to be.  State legislatures and State as well as local associations of realtors are forging their own path if they do not agree with the policy decisions by the NAR.

It remains to be seen whether state and local associations of realtors in Florida continue to follow the NAR policies or follow states such as Alabama and Colorado.