If you sell a home in South Dakota today, you don't have to offer to pay the buyer's agent, and nothing stops you from choosing to. That decision, and how it shows up in the offers you get, is one of the biggest changes in how homes are sold, and it's worth understanding before you list.
Commissions and offers are where a lot of sellers feel the least sure of themselves. The rules changed nationally in 2024, the headlines were confusing, and plenty of people still assume things work the way they did a decade ago. Here's how it actually works now, in plain English, with the rules linked so you can read them yourself.
What Changed in August 2024
On August 17, 2024, practice changes from the National Association of REALTORS® (NAR) settlement took effect. According to NAR's settlement FAQ, consumers can think about them in two parts:
Offers of compensation are off the MLS. A seller, or the seller's agent, can no longer advertise an offer to pay the buyer's agent through the Multiple Listing Service. Sellers can still choose to make that kind of offer, but it has to be communicated another way.
Buyers need a written agreement before touring. Under NAR Policy Statement 8.13, MLS participants working with a buyer must have a written agreement with that buyer before touring a home, unless that conflicts with state or federal law.
The NAR FAQ also says a listing agent has to disclose to the seller, in writing and in advance, any payment or offer of payment to an agent working for a buyer, including the amount or rate, and get the seller's approval.
Those changes aren't going away soon. On August 19, 2026, the U.S. Court of Appeals for the Eighth Circuit affirmed the approval of the nationwide settlement, leaving the practice changes in place.
Commissions Are Negotiable, and It Says So in Writing
There is no standard commission set by law. NAR's policy requires written buyer agreements to include a conspicuous statement that broker fees and commissions are not set by law and are fully negotiable.
South Dakota law has its own writing requirements. Under SDCL 36-21A-130, any agency agreement in which a broker represents a seller has to be in writing and include, among other things, the price and terms, the expiration date, the type of agency relationship, the compensation to be paid, and whether the broker is authorized to cooperate with or compensate other brokers. A buyer agency agreement also has to be in writing and state the compensation. And an agency agreement with a buyer or seller can't include an automatic renewal at expiration.
In other words, nothing about what you'll pay should be a surprise. It's in the agreement you sign, and you're entitled to a copy.
How Buyer's Agents Get Paid Now
This is the part that confuses people most. NAR's FAQ lists several ways a buyer's agent can be paid, depending on what the buyer and agent negotiate:
A fee paid directly by the buyer.
A concession from the seller, requested as part of the buyer's offer.
A portion of the listing agent's compensation, if the seller has agreed to that.
The FAQ also answers a common question directly: yes, a buyer can ask that the listing side pay the buyer's agent. Whatever the source, the buyer's written agreement caps it. Under Policy Statement 8.13, the buyer's agent can't receive more from any source than the amount or rate agreed to with the buyer.
For Sellers, It's a Decision, Not a Default
Before 2024, offering to pay the buyer's agent was close to automatic. Now it's a choice you make with your listing agent, and there's no single right answer.
NAR's FAQ notes that a seller may choose to offer compensation as a way of marketing the home and making the listing more attractive, and that offers of compensation can reduce up-front costs for buyers, particularly first-time buyers. Sellers can also offer buyer concessions on the MLS, for example toward a buyer's closing costs.
Some sellers decide up front what they're willing to offer. Others wait and evaluate what buyers ask for in their offers. Either way, it should be a deliberate decision you make with clear information about your market and your likely buyers, not something that happens by habit. We'll walk through the trade-offs with you and put whatever you decide in writing.
Before the First Offer: Pricing and Preparation
The offers you get are shaped by work that happens before the sign goes up. A good listing agent earns their keep here.
Pricing from closed sales. The best evidence of value is what similar homes nearby have actually sold for recently, adjusted for size, condition, and features. Asking prices on other listings tell you what sellers hope for. Closed sales tell you what buyers paid.
Preparing the paperwork early. The disclosure statement, any repair records, utility history, and HOA documents if they apply. Buyers write stronger, cleaner offers when they have answers up front.
Getting the home ready to show. Small repairs, cleaning, and good photos. In a Black Hills winter, that also means a shoveled walk, a warm house, and lights on for showings.
Setting a strategy for offers. Before the first showing, you and your agent should talk through how you'll handle offers, whether you'll set a deadline if several come in, and your position on buyer concessions and buyer-agent compensation. Deciding calmly in advance beats deciding under pressure on a Saturday night.
Price Is Only One Line in an Offer
When an offer arrives, it's tempting to look at the price and stop there. Don't. A written offer is a package, and the terms can matter as much as the number.
Price. The headline number, and the starting point, not the finish line.
Earnest money. The deposit a buyer puts down to show they're serious, and the terms for when it can be kept or refunded.
Financing. Cash, conventional, FHA, VA, or another loan type, and whether the buyer has been pre-approved. Different loan types can come with different appraisal and property requirements.
Contingencies. Conditions the deal depends on, like inspection, appraisal, financing, or the sale of the buyer's current home. Each one is a way the deal can end, so the deadlines matter.
Dates. The closing date and when you hand over possession. A buyer who can close when you need to move can be worth more than a slightly higher price.
Requested concessions. Closing-cost help, repairs, or a request that you pay some or all of the buyer's agent compensation.
The way to compare offers is by what you actually walk away with and how likely each deal is to close. A higher price with a long list of contingencies isn't always the better offer.
What Your Listing Agent Owes You When Offers Arrive
South Dakota spells out a listing agent's duties. Under SDCL 36-21A-132, an agent representing a seller has to exercise reasonable skill and care and promote the seller's interests with the utmost good faith, loyalty, and fidelity. That includes:
Seeking a price and terms acceptable to you.
Presenting all written offers to and from you in a timely manner, even if the property is already under contract.
Disclosing to you all adverse material facts the agent actually knows.
Advising you to get expert advice on material matters beyond the agent's expertise.
Accounting in a timely manner for all money and property received.
There's a disclosure duty on your side, too. Under SDCL 43-4-38, a seller of residential property has to give the buyer a completed property condition disclosure statement before the buyer makes a written offer. Getting that done early keeps the offer process clean.
Multiple Offers and Counteroffers
When more than one offer arrives, you have options. You can accept one, counter one or more, or decline. Your agent's job is to lay out each offer side by side, explain the risks in each set of terms, and help you decide how to respond.
If the same brokerage ends up representing both you and the buyer, South Dakota allows that only with everyone's informed written consent, under SDCL 36-21A-140. In that limited agency role, SDCL 36-21A-141 bars the agent from disclosing, without your informed written consent, that you'd accept less than the asking price or what's motivating your sale.
Every transaction is different, and laws vary by state. Nothing here is legal or tax advice, so read every agreement before you sign it and ask about anything that isn't clear.
Why This Matters
The rules around commissions and offers now put more decisions in front of sellers, and that's a good thing if you know what you're deciding. A seller who understands the listing agreement, decides on buyer-agent compensation on purpose, and reads offers for terms instead of just price is in a much stronger position than one who signs whatever's put in front of them.
That's what a good listing agent is for: clear explanations, every offer presented and compared honestly, and decisions documented in writing.
Thinking about selling this winter or next spring?
We'll walk you through the listing agreement line by line, explain your options on buyer-agent compensation, and help you compare every offer on what you'll actually net. Let's talk.
Chris Twiggs, South Dakota Real Estate Broker (SD #17641)
Blair Allen Luxury Real Estate helps buyers and sellers across South Dakota.