28 November 2020

More Transparency In Real Estate

 

Good-To-Know:

Justice Department Sues Realtor Group To Enforce Transparency Rules

Published: Friday, November 27, 2020 - 5:05am

"Realtors will have to disclose commissions and change listing practices to be more transparent. The move is in response to a lawsuit filed last week by the U.S. Department of Justice against the National Association of Realtors. 

The lawsuit claims anti-competitive practices by traditional real estate agents in the Multiple Listing Service, or MLS. The U.S. DOJ says the system now is anti-competitive. In the terms, the NAR and related MLS organizations are no longer allowed to prohibit non-members from using lockboxes that prevent non-members from seeing a property. 

“Real Estate Agents, residential real estate agents in particular, control the information, and that’s the single biggest advantage that they have is their ability to control what is on the market and all of the information about that property including what they will get paid,” said Mark Stapp, executive director of the Real Estate Master’s Program at the WP Carey School of Business. 

Stapp said this ruling has particular interest to the Phoenix metro because Zilliow, Offerpad and other non-MLS based companies started in the Valley. 

Zillow and Redfin are essentially MLS services of their own, Stapp said, noting the only major difference being that to list on MLS, an agent must be a paying member of the service to use it and also have a real estate license. He said that means real estate agents who are not part of an MLS group and brokers who are not part of the NAR couldn’t use lockboxes to see houses unless they became members and paid dues. "

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