Realtors Back Away From Plan To Restrict Access to Listings
Thursday, September 8, 2005
In response to antitrust concerns, the National Association of Realtors plans to announce today that it will drop a plan to permit real estate agents to restrict access to home sales listings on the Internet.
Instead it will set rules ensuring that all real estate agents have access to the same information, the trade group said in a statement to be released today. Association officials had previously insisted on maintaining policies that allowed agents to control listings. They said they changed their minds because of a Justice Department investigation into whether the association's policy was stifling competition.
The Justice Department declined to comment.
Regulators have been investigating an earlier Internet multiple-listing policy proposed by the trade group because of concerns it would effectively allow traditional real estate agents to steer potential sales away from new competitors working for smaller commissions. The Realtors association dropped its previously proposed policy in May and had said it was developing a new one.
Consumer activists and antitrust advocates have said the previously proposed policy was designed to make it harder for discount real estate firms to obtain the listing information they need to make sales.
Robert D. Butters, a Chicagoantitrust lawyer who was a deputy general counsel at the Realtors association, said the trade group appeared to be making a preemptive move in establishing its own rules, "whether the Justice Department likes it or not."
"The obvious conclusion is this is their bottom line, with or without government approval," Butters said. "What government now chooses to do is up to the government. It could be a lawsuit or it could be nothing."
Laurene K. Janik, general counsel of the association, acknowledged that the Justice Department is not completely satisfied with the new policy. "This is not an agreed-upon new policy; this a policy adopted by NAR," she said. "We've made every effort to accommodate their concerns, but at the end of the day, we did adopt the policy we thought was best for our own members and consumers."
The controversy has arisen as several new companies, or new units of established companies, have sought to break into the real estate market with cut-rate commissions, often by using the Internet to speed up transactions. Some of the new companies have lobbied federal antitrust officials for protection.
Real estate agents have been criticized for seeking to maintain their traditional 6 percent commissions as home prices soar. Home prices in the Washington region have roughly doubled over five years, so commissions have, too, for roughly the same amount of work.
State real estate groups, meanwhile, have pushed ahead with rules that require agents to provide a full set of services to consumers. Antitrust officials at the Justice Department and Federal Trade Commission have said those rules would hurt consumers because they would make it harder for the new kinds of business models, such as Internet-based firms, to offer services at lower prices.
The state groups have said they are the ones protecting consumers by limiting the growth of companies that offer poor service.