US Dept of Justice plans to sue Realtors

WSJ.com – (link good for 7 days)
WASHINGTON – In a widening push to promote price competition in sales of residential real estate, government antitrust enforcers are preparing to sue the National Association of Realtors, alleging that its policies will illegally restrict discounting of sales commissions and put online competitors at a disadvantage.

In broad terms, the battle is about whether local brokers can claim ownership of the display of home listings in which they represent the sellers. If they lose the battle, some brokers fear, more business will begin to flow to national Web sites like LendingTree.com and RealEstate.com, both units of
IAC/InterActive Corp.

The commissions are shared in various ways. Typically, a listing brokerage firm aims for around 2.5% to 3% of the purchase price, divided between the firm and the agent who handled the listing; the agent who finds the buyer often expects about the same percentage cut, also split with his firm. But many agents are willing to work for less, particularly on large transactions.

Ms. Janik said the dispute amounts to “a question of brokers retaining control of their listings” when they choose not to share them with certain other participants in the multiple-listing service.

I’ll comment more on this later – have some Mr. Mom-ing to do.

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