California
Realtors settlement brings confusion, relief to Southern California’s real estate industry
One thing is known for sure about a proposed settlement of a massive antitrust case against Realtors: the home selling process is about to change, and with it, how buyers and sellers compensate their agents.
Otherwise, say members of Southern California’s real estate industry, it’s too soon to decipher the impact of the $418 million deal unveiled on Friday, March 15.
Also see: Brokerage stocks tumble after Realtors agree to commission-cutting deal
Will buyers now start paying their agents directly?
Will buyers now have to sign a contract before their agent will show them any homes?
Will lenders allow buyers to roll the cost of paying agent commissions into a slightly larger mortgage?
And ultimately, will the settlement lead to to smaller commissions and lower home prices?
Also see: Homebuying’s 6% commission is gone after Realtors settle lawsuit
“There’s just a lot of moving pieces that have to be settled,” said Art Carter, chief executive of the Chino Hills-based California Regional Multiple Listing Service, which covers much of Southern California. “And I’m not going to say I have my arms around every one of those moving pieces.”
In a statement announcing the settlement, the National Association of Realtors said it agreed to a new rule banning sellers from offering compensation to buyers’ agents through a Realtor-affiliated MLS, or home-listing database.
But it was unclear if that will end the decades-old practice of requiring sellers to pay buyers’ agents.
While “offers of broker compensation could not be communicated via the MLS,” the NAR statement said, “they could continue to be an option,” so long as they’re communicated outside the MLS.
“The only certainty I can give you is the process will change,” Carter said.
The Realtor announcement followed an Oct. 31 jury verdict in Kansas City awarding nearly $1.8 billion to Missouri home sellers, finding the current agent compensation system perpetuates the 5-6% commission rate.
More than 20 similar lawsuits proliferated across the nation in the wake of the verdict, including at least three in California, naming more than 200 other industry groups in 11 states as defendants.
California Realtor groups hit with copycat commission rates lawsuit
Under the settlement announced Friday, NAR would pay $418 million over four years, instead of $1.8 billion. The settlement would cover more than a million NAR member agents, all state and local Realtor associations, Realtor-owned multiple listing services and NAR-affiliated brokerages generating less than $2 billion in sales. But large national real estate chains that were NAR’s co-defendants won’t be covered.
A law firm that took part in the settlement hailed the agreement as “groundbreaking,” saying it could save consumers billions of dollars in broker fees.
“This settlement changes (NAR) rules so that competition will occur at the commission level,” Steve Berman, a lead attorney in the case, said in a statement.
In Southern California, the announcement led to a combination of confusion, anxiety and relief.
Carter, the regional MLS CEO, tried to explain the settlement Friday to a meeting of brokers in Arcadia.
“I think there’s just a lot of confusion,” he said of the brokers’ reaction to the news. “They’re just curious to see what the new normal is going to look like.”
There was an element of relief at the Glendale Association of Realtors, one of 19 local Realtor associations named in a class-action lawsuit filed in January.
The settlement appears to be “a good start, a step in the right direction,” said David Kissinger, Glendale Realtors association chief executive.
“We are in defendant in one of the cases,” Kissinger said. “And as a defendant in a case, … that’s concerning. There is substantial risk to us. We were certain in the belief that the case did not have merit. But, you know, the court and the jury are going to do what they’re going to do.”
Carter echoed that sentiment.
“We support NAR for taking the steps” toward settling the cases. “If it would have been litigated further, it could have been quite detrimental to the the industry.”
The proposed effective date will be July 1 if the settlement gets court approval, although that — like everything else — is subject to change, Carter said.
If approved, the settlement could lead to the widespread use of buyer-broker agreements, he said. Currently only about a fifth of buyers sign representation agreements with their agents.
It’s possible sellers could list an amount for concessions in their MLS listings, instead of compensation offers, and buyers could use those concessions as they choose — perhaps paying for repairs, for closing costs or to compensate their agents, Carter said.
“The (agent’s) job is going to change significantly,” said Newport Beach broker Bill Cote, owner of Cote Realty Group. “I think you’re going to see a whole element of people come out and say that they are buyers brokers, and they’re only representing buyers. But the difficulty with that is getting the buyers to step to the plate to say that they’re going to pay the compensation to the buyer’s broker.”
Cote noted that in high-priced communities, from Newport and Laguna Beach to Silicon Valley, the buyer’s share of commissions “has always been very large.”
Ed Coulson, director of the Center for Real Estate at UC Irvine, predicted the settlement could have a major impact on agent earnings and commission rates.
People accepted 5-6% commission rates as if it were a rule, which it’s not, he said.
“One of the things that’s going to happen is people will recognize it’s not a rule, and that’s going to bring commission rates down,” he said. “I think the thing that is most important is we don’t know the impact on prices. There’s been a lot of speculation it would lower house prices, but that depends on the seller folding the commission into the house price. And I’m very uncertain that we know the extent to which that happens.”
California
Xavier Becerra surges in poll after Eric Swalwell drops out of California governor’s race
A new poll shows a major shift in the California governor’s race after former Rep. Eric Swalwell, who was once a frontrunner, dropped out of the election following several allegations of sexual misconduct.
“This definitely throws this race into even more volatility, creates a huge vacuum,” Pomona College politics professor Sara Sadhwani said.
According to the new numbers, Xavier Becerra, the former state attorney general and Health and Human Services Secretary under President Biden, is surging in popularity.
In Emerson College’s Inside California Politics poll, Becerra is now polling at 10%, a seven-point jump since March.
Republican Steve Hilton remains in the lead with 17%, followed by Riverside County Sheriff Chad Bianco at 14%.
Among Democrats, billionaire Tom Steyer leads the pack with 14%, followed by Becerra and former Rep. Katie Porter at 10% each. San Jose Mayor Matt Mahan sits at 5%.
The poll showed that 23% of voters remain undecided.
“Xavier Becerra should be the happiest of them all because he’s the biggest move in this survey,” said Zev Yaroslavsky, director at UCLA’s Luskin School of Public Affairs.
Emerson College conducted the poll right after Swalwell dropped out of the race and President Trump endorsed Hilton.
“I believe over time, because Trump has endorsed Hilton for the governorship, that Hilton will continue to edge up and Bianco by definition will have to go down,” Yaroslavsky said.
Last weekend, the California GOP held its convention, and, similar to the Democrats, the party did not make an endorsement. However, Bianco received the most votes from the GOP delegates.
“We’re extremely happy with how it came out,” Bianco said. “There was a lot of effort put in by my opponent. Hundreds of thousands of dollars to try and win this election.
With the large number of undecided voters, Yaroslavky believes that the race is still in the air.
“It’s still early,” Yaroslavsky said. “It’s a little less than seven weeks before the election. The ballots go out at the beginning of next month. People, at least 30%, still haven’t made up their mind.”
In the state’s primary system, only the top two vote-getters in the June primary will advance to the November general election.
California
Here are the candidates in the running to be California’s next governor
The race to replace California Gov. Gavin Newsom, who terms out after this year, is ramping up with voters able to cast ballots soon.
The stunning collapse of Eric Swalwell’s campaign has upended the wide-open contest where no Democratic candidate has emerged as a clear frontrunner and mail-in voting is scheduled to start in May
California has an unpredictable top-two primary system that puts all candidates on one ballot, with only the top two vote-getters advancing to November, regardless of party. Despite their party’s dominance in the state, Democrats fear their crowded pool of candidates will divide the party’s vote and allow two Republicans to advance.
Here’s a look at the prominent candidates:
California
The race for California state superintendent is wide open: Poll
Elementary students practicing music at school.
Credit: Music Workshop
It’s anyone’s guess who is the front-runner for state superintendent of public instruction. According to a voter survey on K-12 education released Wednesday by the Public Policy Institute of California, none of the 10 candidates for the California schools chief reaches even 10% of support among likely voters.
The PPIC survey of 1,604 California adults was conducted between March 26 and April 3. It also found that voters overwhelmingly approve of teacher strikes and support an initiative, led by the California Teachers Association, that would make permanent a temporary, multi-billion-dollar income tax surcharge on wealthy earners, which is set to expire in 2031.
When asked in the abstract about the quality of education in the state’s public schools, half of voters (51%) said the quality has gotten worse over the past few years and major changes are needed, and 47% of all voters said public schools are headed in the wrong direction. But among public school parents, more than half (57%) said schools are headed in the right direction.
Mark Baldassare, survey director at PPIC, said the results are somewhat surprising, given the increased investments in public education in recent years.
“When you have more than half the people saying that they think that the quality of education has gotten worse, I think that’s something,” Baldassare said. “Given all the efforts that have been made to make it better and the resources that have gone into it, that’s still a sizable proportion who are concerned about where we are and where we’re headed.”
Still, voters’ concerns about the direction in which education is headed do not translate into support for radical changes to education policy, such as vouchers for private and religious schools. Less than a quarter (24%) of likely voters said they would vote yes on an initiative proposed for the November ballot that would require the state to provide money for California residents to attend religious and private schools.
Baldassare said he found it significant that the vast majority (79%) of those surveyed said they were concerned that students in lower-income areas are less likely than other students to be ready for college when they finish high school. A large majority (71%) also said they were concerned about improving educational outcomes for students learning English as a second language.
Good marks for Newsom
The survey found more than half of voters (54%) support Gov. Gavin Newsom’s handling of schools — an increase of 4 percentage points from last year — and there is widespread support for several of the initiatives implemented under his watch, including transitional kindergarten, an extra public school grade for 4-year-olds, limits on cellphone use in schools and protections for immigrant and transgender students.

A majority (61%) also approve of teachers’ unions striking for higher pay. Baldassare said support for teachers has been high for many years, but the answers to the question this year are significant because several teachers’ unions have either gone on strike or threatened to do so, whereas in the past the question was more theoretical.
“That’s really driven by a perception that the cost of living is very high in California and that people are concerned about teachers being able to afford to live here,” Baldassare said.
The PPIC is a prominent nonpartisan research and public policy organization that explores issues of the environment, politics, economics and education, and regularly surveys Californians on their views. The latest education survey has a margin of error of 3.2 percentage points, meaning that 95 times out of 100, the results will be within 3.2 percentage points of what they would be if all adults in California were interviewed.
Race for state superintendent
Almost a third (32%) of likely voters said they did not know who they would vote for in the race for state superintendent of public instruction. The rest were split among the 10 candidates — mostly within the survey’s margin of error — with 9% saying they would vote for Ainye Long, a public school teacher from San Francisco who has not run an active campaign, and 9% for Anthony Rendon, the former speaker of the California Assembly.
Two school board members — Richard Barrera of the San Diego Unified School District and Sonja Shaw, president of Chino Valley Unified School District — each had 7%; Assemblymember Al Muratsuchi and former State Sen. Josh Newman received 6%. Nichelle Henderson, board member of the Los Angeles Community College District, had 5%.
Calling the race “a sleeper outside of the education community,” Barrett Snyder, a partner with Capitol Advisors Group, a government relations firm for public schools, estimated it would take $15 million to $20 million for a candidate to get the awareness it would take to ensure a win.
At this point, no candidate has raised even a 10th of that amount. Former Assembly Speaker Anthony Rendon has collected $1.2 million, and Assemblymember Al Muratsuchi is second with about half of that amount.
The California Teachers Association, the dominant funding source in past state superintendent elections, has endorsed Richard Barrera, the veteran San Diego Unified school board member, but he has raised only about $180,000 so far — though that could change.
This week, the CTA announced it was throwing its support for governor to Tom Steyer, who has committed $100 million of his own fortune to the campaign, reducing the need for the CTA to throw a lot of money into that race. As a result, Snyder said, Barrera could be the biggest benefactor.
“We’re in it to win it. We know it takes money,” CTA President David Goldberg said Wednesday, without specifying how much the union would spend on the state superintendent primary campaign.
Support for transitional kindergarten, limits on cellphone use
Newsom made early education one of his signature issues during his campaign for governor, and in 2022 signed a law gradually expanding transitional kindergarten, an extra grade before kindergarten, to all 4-year-olds, which is now fully implemented.
The vast majority of voters (68%) said they approve of the state funding transitional kindergarten for all 4-year-olds in California. More than two-thirds (72%) said attending transitional kindergarten is somewhat or very important to helping students succeed in later years of school.
A large majority of voters are concerned about disparities in early education. More than two-thirds (69%) said they were concerned that children in lower-income areas are less likely than other children to be ready for kindergarten, and 61% said they were concerned that students who speak English as a second language are less likely than other children to be ready for kindergarten.
An overwhelming majority also approves of limiting cellphone use in schools, which Newsom championed by signing a law in 2024 requiring every school to adopt a policy limiting the use of phones in school by July 1. More than 90% of parents with school-age children support policies that limit phone use in schools. About half (52%) said they prefer banning cellphones during class time but allowing students to use phones at lunch or between classes, while 40% prefer banning cellphones throughout the school day.
Support for school policies protecting undocumented immigrant and transgender students
Two-thirds of voters (67%) said they were somewhat or very concerned about increased federal immigration enforcement under the Trump administration and the effects on undocumented students in their local public schools. The same percentage supports their school districts becoming a “sanctuary safe zone” to protect undocumented students. The Legislature passed several laws last year prohibiting schools from allowing federal immigration agents to enter nonpublic areas of schools without a warrant signed by a judge, and requiring schools to notify parents and students if federal immigration agents were on campus.
The majority of voters (57%) also said it is a good thing that California passed Assembly Bill 1955 in 2024, which bans schools from requiring teachers and staff to disclose students’ gender identity or sexual orientation to parents or others without their permission.
Ballot initiatives and legislation
Other education issues important to voters
- 66% support building affordable housing for teachers on land where public schools have closed
- 84% said community schools, which offer wrap-around services, are important for improving outcomes for underserved students
- 81% said they would vote yes on an initiative requiring risk labels for artificial intelligence or chatbots likely to be used by children
- 71% said it’s important for high schools to offer ethnic studies classes
- 74% said it’s important for high schools to offer education on the environment, climate and sustainability
Likely voters were asked how they would vote on several different initiatives proposed for the November ballot. A large majority (62%) said they would vote yes to make permanent an existing tax rate for high-income Californians, which is currently set to expire in 2031. If the initiative were to fail, it would result in an estimated annual loss of $2 billion to $5 billion for TK-12 schools and community colleges.
Though most voters (47%) said current state funding is “not enough” for public schools, the poll shows that local bond measures and parcel taxes that could provide more funding for public schools might fall short of the 55% majority needed to pass.
Most voters (57%) said they would not approve an initiative that would limit voters’ ability to pass local taxes by requiring a two-thirds majority.
Newsom’s proposal to shift control of the state Department of Education to a new education commissioner appointed by the next governor appears to have weak support, although it is unclear how much voters understood what the policy would entail. When asked whether they support a proposal to “remove the elected state superintendent as the head of the California Department of Education and have the appointed State Board of Education run the California Department of Education,” only 43% approved.
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